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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 23, 1998
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RIBOZYME PHARMACEUTICALS, INC.
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(Exact name of registrant as specified in charter)
Colorado 0-27914 34-1697351
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(State or other (Commission (IRS employer
jurisdiction of file number) identification no.)
incorporation
or organization)
2590 Wilderness Place, Boulder, Colorado 80301
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (303) 449-6500
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N/A
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(Former name or former address, if changed since last report.)
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5. Other Events
On November 23, 1998, Ribozyme Pharmaceuticals, Inc. (the "Company"),
finalized and entered into a Participation Agreement with Atugen Biotechnology
GmbH, a German company ("Atugen"), BB Bioventures L.P., and the following
individuals: Dr. Ralph E. Christoffersen, Mr. Lawrence E. Bullock, Dr. Nassim
Usman, Dr. James Thompson, Ms. Alene Holzman, Dr. Thomas H. Rossing, Dr. Jorg
Potzsch and Dr. Thomas Walther. The Company and Atugen also entered into the
following agreements related to the Participation Agreement: (1) License
Agreement, (2) Manufacturing and Supply Agreement and Sublicense and (3) Service
Agreement.
EXHIBITS
99.1 Participation Agreement dated August 24, 1998 among Atugen
Biotechnology GmbH, the Company, BB Bioventures L.P. and certain
founders
99.2 Amendment to Participation Agreement dated November 23, 1998 among
Atugen Biotechnology GmbH, the Company, BB Bioventures L.P. and
certain founders
99.3 License Agreement dated November 23, 1998 between Atugen Biotechnology
GmbH and the Company
99.4 Manufacturing and Supply Agreement and Sublicense dated November 23,
1998 between Atugen Biotechnology GmbH and the Company
99.5 Service Agreement dated November 23, 1998 between Atugen Biotechnology
GmbH and the Company
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
RIBOZYME PHARMACEUTICALS, INC.
DATE: June 9, 1999 By: /s/ DR. RALPH E. CHRISTOFFERSEN
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Dr. Ralph E. Christoffersen, President
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Exhibit 99.1
CONFIDENTIAL PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO REGULATION
240.24B-2B OF THE SECURITIES EXCHANGE ACT OF 1934. [*] INDICATES OMITTED
MATERIAL THAT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST AND IS FILED
SEPARATELY WITH THE COMMISSSION.
Participation Agreement
- Atugen Biotechnology GmbH -
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Participation Agreement
Among
1. RIBOZYME PHARMACEUTICALS, Inc.,
2950 Wilderness Place
Boulder, Colorado
USA
- hereinafter referred to as "Founder 1" -
2. Dr. Ralph Earl Christoffersen
1995 Stony Hill
Boulder, Colorado 80303
USA
- hereinafter referred to as "Founder 2" -
3. Mr. Lawrence E. Bullock
8550 Waterford Way.
Longmont, CO 80503
USA
- hereinafter referred to as "Founder 3" -
4. Dr. Nassim Usman
2129 Night Sky Lane,
Lafayette, CO 80026
USA
- hereinafter referred to as "Founder 4" -
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5. Dr. James Thompson
2925 Glenwood Drive # 103
Boulder, CO 80301
USA
- hereinafter referred to as "Founder 5" -
6. Ms. Alene Holzman
971 6th Street,
Boulder, CO 80302
USA
- hereinafter referred to as "Founder 6" -
7. Dr. Thomas H. Rossing
13781 N. 115th St.
Longmont, CO 80501
- hereinafter referred to as "Founder 7" -
8. Dr. Jorg Potzsch
Pradelstrasse 9
13187 Berlin
- hereinafter referred to as "Founder 8" -
9. Dr. Thomas Walther
Dunckerstrasse 34
10439 Berlin
- hereinafter referred to as "Founder 9" -
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- - the parties 1 to 9 hereinafter jointly referred to as "Founders" -
10. Atugen Biotechnology GmbH,
Maxmimilianstr. 35,
80539 Munchen
Germany
- hereinafter referred to as the "Company" -
11. BB BioVentures L. P.
One Cambridge Center, 9th Floor
Cambridge, Massachusetts 02142
USA
- hereinafter referred to as the "Investor" -
Preamble
The Founders hold all the shares of the Company Atugen Biotechnology GmbH with
its seat in Munich (application pending for transfer of seat to Berlin)
registered in the Trade Register of the local court of Munich under HRB 119609.
The Founders intend to increase the share capital of the Company in order to
provide the Company with new operating funds. Within the framework of this
capital increase, the Investor shall be given the opportunity to purchase up to
a maximum of 36.65% of the shares in total after the capital increase has
been effected at a closing (the "Closing") as set out in column titled
"Percentage of Share Holding After the First Closing" of annex 20 on a fully
diluted basis.
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The Investor is, inter alia, a capital investment fund which exists partly
for the purpose of making private investments in young companies with
technologically progressive products and for providing the means for business
expansion.
The basis of the Investor's decision to invest is, among other things, the Term
Sheet of June 16, 1998 agreed to and signed by the Founders (annex 1) and the
business plan as amended on July 30, 1998 (annex 2).
In view of these interests the parties conclude the following Participation
Agreement:
Part 1
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Participation
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(S) 1
Increase of Capital
1. Today the Founders will increase the share capital of the Company by
DM 30,600 from DM 50,000 to DM 80,600 with a shareholders' resolution,
recorded by a notary, whereby solely the Investor is allowed to subscribe
the new Shares.
The Investor is allowed to subscribe to a share in the amount of
DM 30,600
created by the increase of capital. The investor shall assume the new
original capital contribution and pay, in addition to the nominal value
of the new share, a surcharge to be allocated to the Company's reserves
(EK04) in the total amount of DM 12,696,246.
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2. The Founders agree to waive their subscription right. Only the Investor is
allowed to take over the new share.
3. The Investor commits itself to subscribe to the new share through a
separately notarized declaration and to pay, in addition to the nominal
value of the new share, a surcharge to be allocated to the Company's
reserves (EK04) in the total amount of DM 12,696,246.
4. The new original capital contribution of DM 30,600 shall be paid in full
before the registration of the capital increase, and the surcharge in the
total amount of DM 12,696,246 shall be paid immediately after the
registration of the capital increase in the Trade Register to the
Company's bank account at the [*] with the account number [*] provided (i)
the parties to this Agreement have by then executed a Vote Pooling
Agreement concerning the election of the Advisory Council members and the
transfer of the Company from GmbH to AG, satisfactory to the Investor; and
(ii) the Company shall have received by then the grant funding contract or
binding commitment letter from BMBF and the Senate of Berlin in the same
amount as outlined in the letters of intent of those institutions
contained in annex 18 and annex 19 as well as reports of a positive
decision by tbg and regarding the GA-Grant funding; and (iii) the Founder
1 has completed, on or before September 30, 1998, certain amendments, as
previously discussed with the Investor, to its existing "Stock Purchase
Agreement" and the "Research, License, Supply and Royalty Agreement" with
Schering AG Company; (iv) all liens and encumbrances on the intellectual
property to be transferred by Founder 1 to the Company pursuant to the
License Agreement (Annex 14) shall be released and extinguished; and (v)
all other agreements to be executed and delivered prior to the Closing
shall have been so executed and delivered and any funding due thereunder
shall have been received by the Company.
5. Founder 1's participation in this Agreement is contingent upon Founder 1
completing, on or before September 30, 1998, certain amendments, as
previously discussed with the Investor, to its existing "Stock Purchase
Agreement" and the "Research, License, Supply and Royalty Agreement" with
Schering AG Company (which amendments shall be the same amendments
referred to above).
6. In the event that the conditions to the payment by the Investor of DM
12,696,246 surcharge (as set forth in (S)1, paragraph 4 above) have not
been fulfilled before January 1, 1999,
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the Investor will transfer its entire share of the Company to Founder 1
for the nominal amount of DM 30,600; provided however, that the Investor
will not be obligated to make such transfer if Founder 1 has materially
breached this Agreement or failed to use its best efforts to satisfy those
conditions to the payment of the surcharge which was within its control.
(S) 2
Transformation into an AG (German Stock Corporation) and
Employee Participation
1. The parties will transform the Company into an Aktiengesellschaft (German
stock corporation), changing its legal form before September 30, 1998,
provided that the terms of the restructuring, as set forth in the
documents to be prepared in connection therewith, are acceptable to the
Investor. In the course of the Company's conversion into an AG, the -
Investor's shares will be changed into preferred convertible stock with
voting rights and liquidation preference ("Vorzugsaktien") as outlined in
annex 17 and the founders' shares will be changed into common stock.
Furthermore, Founder 1 will convert its shareholder loan in the amount of
$10 Mio to be paid over the next 5 years into a shareholder contribution
(EK04) still to be made available to the Company in the same time period.
2. The Founders and the Investor will use their best efforts to agree to the
terms of and to establish an employee stock option model based on the Term
Sheet of June 16, 1998 (annex 1), probably in the form of a right to
convert options into shares ("naked warrants"), to boost the motivation of
the employees of the Company after its transformation into an AG.
3. The documents to be agreed upon in the course of the conversion will
conform as close as possible to the originally agreed corporate documents.
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Part 2
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(S) 3
Assurances and Warranties
In concluding this Agreement, the Investor assumes the veracity of the
statements and explanations given by the Founders and the Company in this
Agreement including annexes, especially the following ones. The Founders and the
Company are aware that the information contained in this Agreement, aside from
the examinations and investigations carried out by the Investor, is the basis of
the Investor's participation. The Founders, subject to the limitations of Part 3
(S) 4, section 1, declare explicitly and stand behind the following declarations
as complete and correct as of the date of this Agreement and as of the date of
Closing, insofar as the following individual explanations do not refer to
specific shareholders, as an independent guarantee in the sense of (S) 305 of
the Bugerliches Gesetzbuch (German Civil Code).
I. Establishment and Continued Existence
1. The Company was established on February 5, 1998 under the name "RM
9810 Vermogensverwaltungs GmbH" and registered with the Local Court
of Munich in the Trade Register under 119609. This is a legally
effective Company with limited liability (GmbH) in accordance with
the provisions of the GmbHG (Private Limited Company Act).
2. The Founder 1 acquired on May 5, 1998 all shares of capital of the
Company, changed the Company's name to "Atugen Biotechnology GmbH",
amended and restated the Articles of Association and applied to move
the Company's seat to Berlin, on June 10, 1998, and finally split
its share with the nominal amount of DM 50,000 into one partial
share with the nominal amount of DM 46,000 and four small partial
shares and sold the latter ones to the Founders 2, 8 and 9 as well
as to the Founders 3 to 7 who are holding their share in the nominal
amount of DM 1,600
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jointly. There are no other shares of capital stock of the Company
issued or outstanding.
The Company has never adopted or maintained any stock option plan or
granted any stock options, and there are no options, warrants,
calls, rights, commitments or agreements of any character, written
or oral, to which the Company is a party or by which it is bound or
committed to issue, deliver, sell, repurchase, or redeem, or cause
to be issued, delivered, sold, repurchased or redeemed, any shares
of the capital stock of the Company, or obligating the Company to
issue any such option, with the exception of provisions under Annex
11, warrant call, right, commitment or agreement.
The Company has the right to conduct its business in its present
form and has all requisite power and authority to enter into this
Agreement and any other Related Agreements to which it is a party
and to consummate the transactions contemplated hereby and thereby.
The execution and delivery of this Agreement and the Related
Agreements to which the Company is a party have been duly authorized
by all corporate action on the part of the Company, and no further
action on the part of the Company is required to authorize the
Agreement, the Related Agreements and the transactions contemplated
hereby and thereby. For purposes of this Agreement, the term
"Related Agreements" shall mean ancillary agreements contemplated by
this Agreement to be executed and delivered in connection with the
transactions contemplated hereby.
3. The object of the enterprise is the research, development, and
commercialization of biotechnological and pharmaceutical products
and services, however not for the ultimate consumer. Excluded from
the foregoing is, in particular, the production of such products
whose purpose is the de-
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livery to others as far as pharmaceutical drugs are qualified in the
sense of the Pharmaceutical Product Law.
4. The Founders have given the Investor a copy of the June 10, 1998
version of the Articles of Association (annex 3) which is the
current registered version. Supplementary contracts and additional
agreements affecting shareholders' rights do not exist.
5. The excerpt from the Trade Register in Munich/Berlin as seen in
annex 4 shows the current legal position correctly and completely
with the exception of the appointment of Dr. Potzsch as general
manager which has been effected by a shareholders' meeting of July
10, 1998, but has not yet been registered in the trade register
because of the pending seat transfer to Berlin.
6. The only persons entitled to represent the Company and to execute
documents on its behalf according to its Articles of Association and
otherwise solely are:
Dr. Ralph Earl Christoffersen
Dr. Jorg Potzsch
7. The nominal share or capital of the Company amounts to DM 50,000. It
is fully paid, and refund payments have not occurred since the
acquisition of the shares through the Founders or earlier.
8. The present shareholders of the Company and the nominal shares
distributed to them are stated in annex 5.
The Founders 1, 2, 8 and 9 each hold their shares as sole owners in
their own name and on their own account. The Founders 3 to 7 hold
their share jointly in their name and on their own account. All of
the shares,
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with the exception of provisions under Annex 11, are free of any
rights of third parties, of whatever sort, and there are no claims
for the grant of such rights or the transfer of shares. The shares
are in particular not pledged or attached or burdened. With the
exception of the obligations resulting from the Articles of
Association with regard to shares of capital, there are in
particular no right of pre-emption, options or similar rights of
third parties. The shares are not subject to executorship or the
conditions of provisional or reversionary succession.
9. Silent shareholders, partiaric loans, royalties or other obligations
in regard to the distribution of the profits and losses of the
Company do not exist.
10. Apart from the Articles of Association of the Company listed in
Annex 3 and other Agreement, resolutions, and promises mentioned
explicitly in this Agreement and its annexes, there are neither any
contracts, resolutions nor promises of any which would regulate the
relationship between the Company and the shareholders or the legal
relationships of the Company or the appointments to a body of the
Company or obligations to conclude such contracts, resolutions or
promises.
11. At no time has a petition to open bankruptcy/composition proceedings
with regard to the assets of the Company or a winding-up resolution
been made.
II. Declarations with of Assets and Financial Standing
1.a) The Company has no binding obligations with regard to taxes or
social insurance contributions or other contributions for an
employee's pension, warranty or guarantee contracts, bills of
exchange or suretyships.
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1.b) Pension obligations do not exist. Promises for pensions have not
been made.
1.c) The Company has no contingent liability arising from suretyships,
guarantees, etc. with the exception of the normal warranties arising
within the framework of the proper Company management. The same
applies to all shareholders of the Company in relation to the
Company.
1.d) Hidden distributions of profits did not occur.
1.e) The Company is not overindebted or insolvent.
2. The Company is entitled to the full, exclusive and unencumbered
ownership of each of the assets of the Company at the moment of the
capital increase including, but not limited to full, unlimited and
unencumbered ownership or exclusive licenses as set out in annex 14
and also possession of all tangible and intangible assets which
currently serve the business activity of the Company or which are
designated to serve it. The assets of the Company are not liable for
the obligations of third parties.
3. Since the date of its formation, the Company has been managed within
the framework of the normal and proper course of business. Since its
establishment, no material business incidents or legal transactions
have occurred or were undertaken, and no event which individually or
in conjunction with other events which did or could have
substantially, negatively influenced the assets or profit margin of
the Company occurred
4. Since the date of its formation, the Company has not suffered any
damages or losses which individually or together could have a
material effect on the Company or its financial status. No
distribution of profits or decisions regarding the distribution of
profits have occurred since the acquisition of the shares by the
founders.
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5. The Company owns no real estate.
III. Other Declarations
1. Neither the Company nor the Founders and their direct relatives hold
shares in other enterprises which operate in the field of the
Company (as described in Annex 2) or a direct competitor of the
Company or have business relations with the Company except for
holdings detailed in annex 6.
2. The Founders each individually declare that they are not the owner
of any intellectual property rights (patents, licenses, other
intellectual property rights) on the basis of which any royalty
payment could be demanded from the Company or the Company's business
conduct could be impeded or prohibited world-wide with the
exception of the patents and patent applications of Founder 1 in
accordance with annex 13 which are subject to licenses to the
Company through the license agreement drafted in annex 14 and the
Service Agreement drafted in annex 15.
(a) Annex 21 contains a complete and accurate list of all (i)
patented or registered intellectual property rights owned by
the Company or owned by Founder 1 and being transferred to the
Company in connection with the transactions contemplated
herein, (ii) pending patent applications and applications for
registrations of other intellectual property rights filed by
Founder 1 which relate to the technology to be transferred to
the Company, (iii) material unregistered trade names and
corporate names owned by the Company, (iv) material
unregistered trademarks, service marks, copyrights, mask works
and computer software owned by the Company and (v) all other
intellectual property rights owned by the Company
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that are material to the operation of the business of the
Company as presently conducted and as presently proposed to be
conducted. The items listed on Annex 21 constitute all of the
intellectual property and intellectual property rights
necessary for the operation of the Company's business as
contemplated by this Agreement and the other agreements
contemplated hereby.
(b) Annex 22 also contains a complete and accurate list of (i) all
material licenses and other rights granted by the Company to
any third party with respect to any intellectual property
rights, except with respect to rights granted to customers of
the Company with respect to the Company's products in the
ordinary course of business, (ii) all material licenses and
other rights granted by Founder 1 to any third party with
respect to any intellectual property rights to be transferred
to the Company, and (iii) to the extent not disclosed pursuant
to Paragraph 1(a), all licenses and other rights material to
the operation of the businesses of the Company as presently
conducted and as presently proposed to be conducted, free and
clear of all liens or encumbrances granted by any third party
to the Company with respect to any intellectual property
rights, in each identifying the subject intellectual property
rights.
(c) Except to the extent set forth Annex 21 and the schedule of
exceptions, (i) the Company and Founder 1 collectively own all
right, title and interest in and to all of the intellectual
property rights listed or required to be listed on Annex 21
pursuant to Section 2(a), free and clear of all liens or
encumbrances; (ii) the Company will have pursuant to the
license granted by Founder 1, a valid license to all
intellectual property rights not owned by Founder 1 that are
material to the operation of the contemplated businesses of the
Company as presently conducted and as presently proposed to be
conducted (including but not
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limited to those intellectual property rights listed on Annex
21 pursuant to Sections 2(a), and (b)), free and clear of all
liens or encumbrances, and such license or licenses will not be
terminated as a result of or require any third party consent to
effect an effective transfer via the license to the Company;
(iii) the conduct of the Founder 1's business as it relates to
the technology being licensed to the Company, to the Knowledge
of Founder 1 without having conducted any infringement
analysis, has not infringed, misappropriated or conflicted with
and does not infringe, misappropriate or confilct with any
intellectual property right of other Persons; (iv) Neither the
Company nor Founder 1 has received any notices of, any
infringement or misappropriation by, or conflict with, any
third party with respect to such intellectual property rights
(including, without limitation, any demand or request that the
Company or Founder 1 license any rights from a third party)
nor, to the Company's or Founder 1's knowledge, are there valid
grounds for any such assertion of infringement,
misappropriation or conflict; (v) to the best of the Company's
and Founder 1's knowledge, the intellectual property rights
owned by or licensed to the Company have not been infringed,
misappropriated or conflicted by other persons or entities; and
(vi) Founder 1 has taken all actions reasonably necessary to
maintain and protect the Intellectual Property Rights which
they own.
Each service provider of Founder 1 has executed a proprietary information
and inventions agreement that provides for the confidential treatment of
the intellectual property rights of Founder 1 and the assignment to
Founder 1 of inventions developed in connection with the performance of
services for Founder 1, in the form previously furnished or made available
to the Investors. To the Founder 1's best knowledge, no such service
provider is in violation thereof. To Founder 1's best knowledge, all
relevant technology has been assigned to Founder 1 by all service
providers. Each service provider of the Company will execute a proprietary
information and inventions agreement that provides for the confidential
treatment of the intellectual property rights to be held by the Company
and the assignment to the Company of inventions to be developed in
connection with services performed for the Company.
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3. The Founders declare that since the acquisition of the shares by the
Founders, the Company did not and does not engage in any anti-
competition violations which could have a considerable influence on
the profitability and the longevity of the Company.
4. The Company possesses or is applying for all essential official
approvals and licenses, which are necessary for the management of
the present business enterprise. The Company has not infringed on
the rights of third parties or governing law including competition
laws, commercial business laws, and the provisions of environmental
protection since the acquisition of the shares by the Founders. In
the past, the business enterprise has also not infringed on any
provisions which serve to protect the environment.
5. To the best of the Founders' knowledge, the Company owns or has
entered into agreements to provide it with the production and
procedural know-how as well as all related documents to develop and,
if necessary, to produce and to sell products.
6. To the best of the Founders' knowledge, there are no special
circumstances which could significantly impair the business of the
Company in the future.
7. Annex 7 of this Agreement contains a complete and correct list of
all bank accounts of the Company and all powers granted to employees
for the respective bank accounts.
8. Claims for compensation by an employee as an inventor have not been
submitted to the management since the acquisition of the shares by
the
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Founders. To the best of the Founder's knowledge, the Company
does not use any inventions made by employees other than those to
which it holds title or valid license rights.
9. The Company has not yet established an advisory council.
10. The Company has not been a party to continuing or threatened
lawsuits, arbitration proceedings, tax proceedings, administrative
proceedings, or investigations since the acquisition of the shares
by the Founders. Since this point in time, the Company has not been
subject to any judgements, administrative acts or the like which
would significantly interfere or limit specific business measures
for the acquisition or transfer of assets, for competition, or for
the management of the business enterprise. To the best of the
Founders' and the Company's knowledge, the Company is not delayed in
performance of any contractual or legal obligations to the current
day.
11. Annex 8 of this Agreement contains all obligations to third parties
(e.g. banks, leasing companies, lessors) worth more than DM 50,000
(fifty thousand German marks) per annum which were entered into or
granted with the exception of those concerning employment
relationships.
12. As long as nothing else is revealed by this Agreement, the Company
has delivered all tax returns and all other legally necessary
declarations to the public authorities by the deadline or within an
explicit or implicit extension. The Company has paid all taxes,
prepayment of taxes, and other compulsory public charges due and
withheld all taxes to be withheld, social insurance contributions,
and other compulsory public charges. The Company delivered and/or
paid the foregoing to the re-
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spective recipients within the deadline including all related late
penalties and fines.
13. With the exception of the contracts mentioned explicitly in this
Agreement including its annexes, particularly the enclosed contracts
made with the Founders (annex 11, 12, 14 - 16), in particular the
Company is not a party to contracts of the following kind:
- contracts or other settlements with the Founders, their
relatives, dependent enterprises, or former shareholders;
- contracts with third parties relating to the acquisition of a
share in the Company or similar rights of third parties;
- tenancy agreements, leases, and leasing contracts with a value of
more than DM 50,000 (fifty thousand German marks) per annum
with the exception of the usual contracts for equipment for
utilities, office furnishings, automobiles and operating
equipment ;
- other contracts which individually or together establish an
obligation exceeding DM 100,000 (one hundred thousand German
marks) per annum and with whose fulfillment no party had yet
begun at the time of concluding this contract with the
exception of such contracts which have been concluded in the
normal course of business;
- agreements concerning the purchase or sale of items from the
fixed assets or construction contracts with a value of more
than DM 50,000 (Fifty Thousand German marks);
- commission agreements or the like in connection with the existing
shareholdings;
- contracts which could significantly impair the Company in its
business conduct or in its freedom of competition;
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- collective or Company-specific collective employment agreements.
14. The Company is in compliance with (a) the terms of its Articles of
Association, by-laws or other charter or organizational documents,
(b) all Contracts to which the Company is a party or by or to which
any of them or their assets or Properties may be bound or subject,
(c) all applicable laws, statutes, ordinances, rules, regulations or
other legal requirements, whether federal, state, local or foreign,
and (d) all applicable orders, writs, judgements, injunctions,
awards and decrees of any court, other governmental entity or
arbitrator except, in the case of (b) and (c), such failures to
comply as would not have a material adverse effect. The Company has
not received any written or oral notice of any violation by the
Company of, or default by the Company under, any of the items
described in clauses (a) through (d) above in this paragraph.
15. No consent, approval, order or authorization of, or registration,
qualification, designation, declaration or filing with, any
governmental authority is required on the part of the Company in
connection with the execution and delivery of this Agreement, the
offer, issuance, sale and delivery of the capital stock of the
Company, or the other transactions to be consummated in connection
with this Agreement, except such filings as have been made prior to
and shall be effective before the execution of this Agreement by the
Company.
Part 3
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(S) 4
Liability
1. In case of a violation of assurances or warranties within the meaning of
(S) 3 of this Agreement, the Founders , as co-debtors (debtors jointly and
severally li-
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able) with regard to the Investor and the Company, are obligated to
replace the full damage to the Company or the proportionate damage to the
Investors, even insofar as the damage only affects the Company, upon the
election of the Investor. Damage is the net worth of the difference
between the described or guaranteed state of affairs and the actual state
of affairs or, if the net worth cannot be ascertained, the estimated costs
for bringing about the described or guaranteed state of affairs. However,
the liability of the Founders 2-9 jointly is limited to a maximum of DM
50,000
2. The regulations of German Civil Code (S) 439 para. 1 and (S) 460 are only
applicable to defects which are explicitly disclosed in this agreement.
Moreover the Investor have the right to exercise their rights from this
agreement independently of the fact that if they, their organs,
employees, representatives, advisors or auditors knew or should have known
of the deficiency where they or their advisors were given a sufficient
opportunity for examination. German Civil Code (S) 464 and German
Commercial Code (S) 377 are not applicable.
3. Limitation of Liability in Time
a) The limitation period for all claims of the Investor and the Company
based on this agreement runs until two months after the submission
of the annual report for the financial year of 1999 as far as there
is no longer statutory limitation period valid for the claim.
b) Possible claims in connection with (S) 3 I No. 1- 11 shall expire
after 10 years.
4. Rescission ("Wandlung") and resignation ("Rucktritt") are impossible in
view of the present agreement except on the part of the Investor if a
statement contained in (S) 3 I Nos. 1-11 is incorrect. The right to avoid
this Agreement according to (S) 123 German Civil Code remains unaffected.
[*] Confidential treatment requested
<PAGE>
-21-
Part 4
------
New Provisions
--------------
(S) 5
Articles of Association / Transformation into an AG
1. The Founders shall change the Articles of Association of the Company in
accordance with annex 10 by a notarized shareholders' resolution.
2. The Company will decide to create an Advisory Council numbering six
members. The first advisory council shall be composed of the following
people:
(advisory council person 1 designated by founder 1, chairman)
(advisory council person 2 designated by founder 1)
(advisory council person 3 designated by investor)
(advisory council person 4 designated by investor)
(advisory council person 5, pharma expert)
(Prof. Ganten, advisory council person 6)
3. The Company shall from time to time:
(i) deliver to the Investor as soon as practicable, but in any event with
in ninety (90) days after the end of each fiscal year of the Company, an
income statement for such fiscal year, a balance sheet of the Company and
a statement of stockholders' equity as of the end of such year, and a
schedule as to the sources and applications of funds for such year, such
year-end financial reports to be in reasonable detail and prepared in
accordance with generally accepted accounting principles;
(ii) deliver to the Investor within thirty (30) days of the end of each
month, an unaudited income statement and schedule as to the sources and
applications of funds and balance sheet for and as of the end of such
month, in reasonable detail;
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<PAGE>
-22-
(iii) deliver to the Investor as soon as practicable, but in any event
thirty (30) days prior to the end of each fiscal year, a budget and
business plan for the next fiscal year, prepared on a monthly basis,
including balance sheets and sources and applications of funds statements
for such months and promptly after they are prepared, any other budgets or
revised budgets prepared by the Company;
(iv) deliver to the Investor such other information relating to the
financial condition, business, prospects or corporate affairs of the
Company as Investor may from time to time request;
(v) maintain its rights to property, including all intellectual property
and to its facilities in accordance with the best interests of its
stockholders;
(vi) maintain such insurance, including if determined by the Advisory
Council, key person insurance (especially for Drs. Christoffersen and
Usman and any other officers of the Company);
(vii) pay its taxes and other obligations as and when they become due in
the ordinary course of its business;
(viii) notify Investor of any material defaults by the Company, of all
material litigation by or against the Company;
(ix) conduct its business in compliance with all applicable laws and with
its Articles of association ("Gesellschaftsvertrag")
(x) maintain a proper system of internal accounting controls;
(xi) maintain in full force and effect the License Agreement and the
Services Agreement between the Company and Founder 1, subject to the
Termination provision therein.
4. The Company commits itself to announce the new Articles of Association
after the corresponding shareholders` resolution to the Trade Register
without delay. Possible later changes to the Articles of Association shall
be effected in accordance with the law and the Articles of Association.
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-23-
(S) 6
Technology, Know-How, Advisory, Service Agreements and Loan Agreements
1. The Company has concluded an employment agreement for the position of
general manager with Dr. Christoffersen and Dr. Potzsch in accordance with
annex 11.
2. The Company has concluded individual employment contracts with Mr. Andre
Hansen in accordance with annex 12.
3. The Company has concluded a License Agreement and a Service Agreement with
the Founder 1 in accordance with annex 14.
4. The Company has concluded a Service Agreement with the Founder 1 in
accordance with annex 15.
5. The Company has concluded a Loan Agreement with the Founder 1 in
accordance with annex 16.
(S) 7
Commitment under the Law of Obligations to the New Articles of Association
Even before adoption of the resolution necessitated by the increase of capital
and the change of the Articles of Association, the shareholders are obligated to
observe the interests of the Investor and to maintain the orderly continuation
of the Company. Until the registration of the increase of capital, the Founders
will not resolve to or undertake any distribution of profits.
(S) 8
Costs
All costs of the parties to this Agreement, including reasonable legal fees and
related out-of-pocket expenses, in connection with the conclusion of this
Agreement, the increase of capital, the subscription to the new shares, the
change of the Articles of Association, the
[*] Confidential treatment requested
<PAGE>
-24-
application for registration in the Trade Register, and other parts of the
transaction directly concerning the Company's relationships are to be borne by
the Company.
(S) 9
Condition of Postponement
This Agreement is subject to the postponement condition that the investors
effectively sign their take-over (assumption) declarations in accordance with
(S) 1 paragraph 3 within two months of the signing of this Agreement.
(S) 10
General Provisions
1. The agreements reached in the term sheet of June 16, 1998, insofar as they
are regulated in detail in this Agreement including annexes, are rescinded
with the effectiveness of this Agreement; so that in the future only
individual points, in particular those in relation to the future
transformation of the Company into a stock corporation with limited
liability, shall have effect.
2. Should any of the provisions of this Agreement prove to be invalid or
should this agreement contain omissions, the efficacy of the remaining
provisions shall not be disturbed. In lieu of the invalid provision, the
valid provision, which comes closest to fulfilling the intended economic
purpose of the invalid provision, shall be deemed agreed upon. In the case
of omissions, the provision, which represents the meaning and intention of
this agreement and would have been agreed to if the parties had been aware
of it shall be deemed agreed upon.
3. The validity of this Agreement is not conditional on access to a copy of
this Agreement signed by all the parties.
[*] Confidential treatment requested
<PAGE>
-25-
4. Alterations and supplements to this Participation Agreement necessitate a
writing, provided the law does not stipulate a stricter form. The
requirement of the written form can only be cancelled by a written
agreement of all parties to this agreement.
5. Exclusive place of jurisdiction and venue for all disputes in connection
with the participation created by this agreement is Berlin, insofar this
is legally permissible.
6. The annexes to this Agreement are an essential part of it. The headings in
this Agreement only serve for a better orientation and are of no
significance for the content and interpretation of this agreement.
Explanations in a provision or annex of this Agreement are also deemed
listed for purposes of all other provisions or annexes.
7. A German and an English version of this Agreement exist. Only the English
version of this Participation Agreement is binding.
Boulder, August 24, 1998
--
/s/ Larry Bullock
-------------------------------------------------
RIBOZYME PHARMACEUTICALS, Inc.
Founder 1
/s/ Ralph E. Christoffersen
-------------------------------------------------
Dr. Ralph Earl Christoffersen
Founder 2
/s/ Larry Bullock
-------------------------------------------------
Mr. Larry Bullock
Founder 3
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/s/ Nassim Usman
-------------------------------------------------
Dr. Nassim Usman
Founder 4
/s/ James Thompson
-------------------------------------------------
Dr. James Thompson
Founder 5
/s/ Alene Holzman
-------------------------------------------------
Ms. Alene Holzman
Founder 6
/s/ Thomas Rossing
-------------------------------------------------
Dr. Thomas Rossing
Founder 7
Boston, August __, 1998
BB BIOVENTURES L.P.
By: /s/ Luke Evnin
Name: Luke Evnin
Title: Managing Director
Berlin, August 31 , 1998
[*] Confidential treatment requested
<PAGE>
-27-
/s/ Jorg Potzsch
-------------------------------------------------
Dr. Jorg Potzsch
Founder 8
/s/ Thomas Walther
-------------------------------------------------
Dr. Thomas Walther
Founder 9
/s/ Ralph E. Christoffersen
-------------------------------------------------
Atugen Biotechnology GmbH
Company
List of Annexes
---------------
to the
------
Participation Agreement
-----------------------
Annex 1: Signed Term Sheet of June 16,1998
Annex 2: Business Plan in the version of July 30, 1998
Annex 3: Minutes from the shareholders' meeting of June 10, 1998
including the Articles of Association
Annex 4: Excerpt from the Trade Register
[*] Confidential treatment requested
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-28-
Annex 5: List of Shareholders
Annex 6: Shareholdings in other Companies Which Are Active in
the Field of the Company or a Related Field or Are in a
Business Relationship with the Company
Annex 7: Bank Accounts of the Company
Annex 8: Obligations of the Company Exceeding DM 50,000
Annex 9: List of Employees
Annex 10: Draft of the New Articles of Association
Annex 11: Employment Contracts for the General Manager(s)
Annex 12 Employment Contract
Annex 13 Patents and applications for patents of founder 1
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-29-
Annex 14 License Agreement
Annex 15 Service Agreement
Annex 16 Loan Agreement
Annex 17 Rights of Preferred Stock
Annex 18 Letter of Intent (BMBF)
Annex 19 Letter of Intent (Senate of Berlin)
Annex 20 Cap table
Annex 21 Founder 1 Patents and Trademark
Annex 22 List of Existing Licensees
[*] Confidential treatment requested
<PAGE>
Exhibit 99.2
CONFIDENTIAL PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO REGULATION
240.24B-2B OF THE SECURITIES EXCHANGE ACT OF 1934. [*] INDICATES OMITTED
MATERIAL THAT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST AND IS FILED
SEPARATELY WITH THE COMMISSSION.
AMENDMENT
TO
THE PARTICIPATION AGREEMENT
OF AUGUST 24, 1998
This Amendment to the Participation Agreement dated August 24, 1998
("Amendment"), is entered into by and between: Ribozyme Pharmaceuticals Inc., a
Delaware corporation ("Founder 1); Dr. Ralph E. Christoffersen ("Founder 2");
Mr. Lawrence Bullock ("Founder 3"); Dr. Nassim Usman ("Founder 4"); Dr. James
Thompson ("Founder 5"); Ms. Alene Holzman ("Founder 6"); Dr. Thomas H. Rossing
("Founder 7"); Dr. Jorg Potzsch ("Founder 8"); Dr. Thomas Walther ("Founder 9");
Atugen Biotechnology, GmbH, a German entity ("Company"); and BB Bioventures L.P.
and its affiliates, all of which are managed by MPM Asset Management, LLC.,
("Investor"), as of this 23 day of November, 1998 (Effective Date). Founders
-- --------
1-9 may hereinafter be referred to as "Founders."
RECITALS:
A. The Founders, Investor and Company are parties to a Participation Agreement
dated August 24, 1998 ("Agreement").
B. The Founders, Investor and Company desire to amend the Agreement as set
forth below.
I. AMENDMENTS:
A. At all points in the document, DM12,696,246 shall be equivalent to
US$7,000,000.
B. PREAMBLE
--------
Replace the second paragraph with the following:
"The Founders intend to increase the share capital of the Company in order
to provide the Company with new operating funds. Within the framework of
this capital increase, the Investor shall be given the opportunity to
purchase a share in the nominal amount of up to 30,600 DM in total after
the capital increase has been effected at a closing (the "Closing") as set
out in Annex 26."
[*] Confidential treatment requested
<PAGE>
B. PART 1: PARTICIPATION
---------------------
1. Section 1: Increase of Capital
a. Paragraph 4 shall be replaced with the following:
------------------------------------------------
"The Investor shall pay the original capital contribution of DM
30,600 and Founder 1 shall pay to the Company the US $2,000,000
financial support required by the Service Agreement, the form of
which is attached hereto as Annex 25, both immediately upon the
execution of this Amendment by all parties hereto. Immediately
upon receipt by the Company of the US$2,000,000 from Founder 1,
the Investor shall also transfer to the Company, its US$7,000,000
surcharge. All payments under this section shall be wired or made
by check to the Company's bank account at the Commerzbank, Berlin
with the [*] and such payments shall be net of any bank transaction
fees."
b. Paragraph 5 shall be deleted in its entirety.
---------------------------------------------
c. Paragraph 6 shall be deleted in its entirety
----------------------------------------------
d. The following new Paragraph 7 shall be added:
---------------------------------------------
"The Parties agree that a partial share of Founder 1 in the
nominal amount of DM 8,500 shall be redeemed on or before
December 31, 1998 for the compensation of DM 8,500. Such a
redemption shall be contingent upon the receipt of License Fees
by Founder 1 from the Company as provided and defined in the
License Agreement (Annex 23)."
2. Section 2: Transformation into an AG (German Stock Corporation) and
Employee Participation
a. Paragraph 1 shall be replaced with the following:
-------------------------------------------------
"The Parties will convert the Company into an Aktiengesellschaft
(German Stock Corporation), changing its legal form within sixty
(60) days from the date of Closing, provided that the terms of
the restructuring, as set forth in the documents to be prepared
in connection therewith, are acceptable to the Investor. In the
course of the Company's conversion into an AG, the Investor's
shares will be changed into preferred convertible stock
[*] Confidential treatment requested
<PAGE>
with voting rights and liquidation preference ("Vorzugsaktien") as
outlined in annex 17 and the founders' shares will be changed into
common stock. "
C. PART 2: ASSURANCES AND WARRANTIES
---------------------------------
1. Section 3, Subsection I (2), paragraph 1 shall be replaced with the
following:
"On May 5, 1998, Founder 1 acquired all capital shares of the
Company, changed the Company's name to "Atugen Biotechnology GmbH",
amended and restated the Articles of Association. On June 10, 1998,
the Company moved the Company's seat to Berlin, shortly thereafter
split its share with the nominal amount of DM 50,000 into one partial
share with the nominal amount of DM 46,000 and four small partial
shares and sold the latter ones to the Founders 2, 8 and 9 as well as
to the Founders 3 to 7 who are holding their share in the nominal
amount of DM 1,600 jointly. There are no other shares of capital
stock of the Company issued or outstanding (see Annex 26)."
2. Section 3, Subsection I (5) shall be replaced with the following:
"The excerpt from the Trade Register in Berlin as seen in annex 4
correctly and completely shows the Company's current legal status,
except that such excerpt does not reflect the appointment of Dr.
Potzsch as general manager, which appointment was effected by the
shareholders' meeting of July 10, 1998."
3. Section 3, Subsection I (6) shall be replaced with the following:
The only persons entitled to represent the Company and to execute
documents on its behalf are:
Dr. Ralph Earl Christoffersen
Dr. Jorg Potzsch
Dr. Michael Steinmetz (upon Closing and shareholder action)
4. Section 3, subsection II: Declarations with of Assets and Financial
Standing
a. Paragraph 1(a) shall be replaced with the following:
"The Company has no due binding obligations with regard to
taxes or social insurance contributions or other contributions
for an employee's pension, and the
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<PAGE>
Company is not obligated under any warranty or guarantee
contracts, bills of exchange or suretyships."
b. Paragraph 1(b) shall be replaced with the following:
"Past due pension obligations do not exist. Promises for pensions
have not been made."
c. Paragraph 2, line 4:
--------------------
"[A]nnex 14" shall be replaced with Annex 23 and Annex 24--
5. Section 3, subsection III: Other Declarations
a. Paragraph 2 shall be replaced with the following:
-------------------------------------------------
"The Founders each individually declare that they are not the
owner of any intellectual property rights (patents, licenses,
other intellectual property rights) on the basis of which any
royalty payment could be demanded from the Company or the
Company's business conduct could be impeded or prohibited world-
wide with the exception of the patents and patent applications of
Founder 1 which are subject to licenses to the Company through
the license agreements enclosed herein as Annex 23 and Annex 24
and the Service Agreement enclosed herein as Annex 25.
(i) To the extent set forth in Annex 27, the initial Licensed
Technology List to be provided by Founder 1 to the Investor
pursuant to Section 3.2.5(1) of the License Agreement attached
hereto as Annex 23, the Cech Patents in the Annex 24, and the
"Pending Trademark Applications list in Annex 21, (together
"Founder 1 IP"), considered together, contain a complete and
accurate list of all (a) patented or registered intellectual
property rights owned by the Company or owned by Founder 1 and
being transferred or licensed to the Company in connection with
the transactions contemplated herein, (b) pending patent
applications and applications for registrations of other
intellectual property rights filed by Founder 1 which relate to
the technology to be transferred or licensed to the Company, (c)
material unregistered trade names and corporate names owned by
the Company, (d) material unregistered trademarks, service marks,
copyrights, mask works and computer software owned by the Company
and (e) all other intellectual property rights owned by the
[*] Confidential treatment requested
<PAGE>
Company that are material to the operation of the business of the
Company as presently conducted and as presently proposed to be
conducted. The items constituting the Founder 1 IP constitute all
of the intellectual property and intellectual property rights
necessary for the operation of the Company's business as
contemplated by this Agreement and the other agreements
contemplated hereby.
(ii) Annex 22 also contains a complete and accurate list of (a)
all material licenses and other rights granted by the Company to
any third party with respect to any intellectual property rights,
except with respect to rights granted to customers of the Company
with respect to the Company's products in the ordinary course of
business, (b) all material licenses and other rights granted by
Founder 1 to any third party with respect to any intellectual
property rights to be transferred to the Company, and (c) to the
extent not disclosed pursuant to Paragraph 2(i), all licenses and
other rights material to the operation of the businesses of the
Company as presently conducted and as presently proposed to be
conducted, free and clear or subordinated of all liens or
encumbrances granted by any third party to the Company with
respect to any intellectual property rights, in each identifying
the subject intellectual property rights.
(iii) Except to the extent set forth in the schedule of
exceptions provided to the Investor, (a) the Company and Founder
1 collectively own all right, title and interest in and to all of
the intellectual property rights listed or required to be listed
in the Founder 1 IP pursuant to Section 2(i), free and clear or
subordinated of all liens or encumbrances; (b) the Company will
have pursuant to the license granted by Founder 1, a valid
license to all intellectual property rights not owned by Founder
1 that are material to the operation of the contemplated
businesses of the Company as presently conducted and as presently
proposed to be conducted (including but not limited to those
intellectual property rights listed under Founder 1 IP pursuant
to Sections 2(i), and (ii)), free and clear or subordinated of
all liens or encumbrances, and such license or licenses will not
be terminated as a result of or require any third party consent
to effect an effective transfer via the license to the Company;
(c) the conduct of the Founder 1's business as it relates to the
technology being licensed to the Company, to the best of Founder
1`s knowledge, and except as disclosed to the Investor, as of
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the effective date of this Agreement, Founder 1 is not aware that
it has infringed, misappropriated or conflicted with any
intellectual property rights of other persons; (d) neither the
Company nor Founder 1 has received any notices of, any
infringement or misappropriation by, or conflict with, any third
party with respect to such intellectual property rights
(including, without limitation, any demand or request that the
Company or Founder 1 license any rights from a third party) nor,
to the Company's or Founder 1's knowledge, are there valid
grounds for any such assertion of infringement, misappropriation
or conflict; (e) to the best of the Company's and Founder 1's
knowledge, the intellectual property rights owned by or licensed
to the Company have not been infringed, misappropriated or
conflicted by other persons or entities; and (f) Founder 1 has
taken all actions reasonably necessary to maintain and protect
the Intellectual Property Rights which they own.
Each service provider of Founder 1 has executed a proprietary
information and inventions agreement that provides for the
confidential treatment of the intellectual property rights of
Founder 1 and the assignment to Founder 1 of inventions developed
in connection with the performance of services for Founder 1, in
the form previously furnished or made available to the Investors.
To the Founder 1's best knowledge, no such service provider is in
violation thereof. To Founder 1's best knowledge, all relevant
technology has been assigned to Founder 1 by all service
providers. Each service provider of the Company will execute a
proprietary information and inventions agreement that provides
for the confidential treatment of the intellectual property
rights to be held by the Company and the assignment to the
Company of inventions to be developed in connection with services
performed for the Company."
b. Paragraph 7 shall be replaced with the following:
"Annex 28 of this Amendment contains a complete and correct list
of all bank accounts of the Company and all powers granted to
employees for the respective bank accounts."
c. Paragraph 11 shall be replaced with the following:
--------------------------------------------------
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"Other than obligations to employees, obligations to make
---------------------------------------------------------
payments upon a line of credit in the amount of DM 1,000,000 and
----------------------------------------------------------------
those obligations listed on Annex 8, the Company is not a party
---------------------------------------------------------------
to any contract or other agreement or obligation pursuant to
------------------------------------------------------------
which it is committed or would become committed upon the
--------------------------------------------------------
fulfillment of contingencies to pay to any party an amount
----------------------------------------------------------
greater than DM 50,000 per annum."
----------------------------------
D. PART 4: NEW PROVISIONS
----------------------
1. Section 3(vi) shall be replaced with the following:
"maintain such insurance, including if determined by the Advisory
Council, key person insurance"
2. Section 6: The title shall be replaced with the following:
"License, Sub-License and Service Agreements"
a. Paragraph 1 shall be replaced with the following:
"The Company has concluded an employment agreement for the
position of general manager with Dr. Potzsch in accordance with
annex 11."
b. Paragraph 2 shall be replaced with the following:
-------------------------------------------------
"The Company has concluded individual employment contracts with
the employees listed in the Annex 29."
c. Paragraph 3 shall be replaced with the following:
-------------------------------------------------
"The Company has concluded a License Agreement and a Sub-License
Agreement with the Founder 1 in the forms attached hereto as
Annex 23 and Annex 24, respectively."
b. Paragraph 4 shall be replaced with the following:
-------------------------------------------------
"The Company has concluded a Service Agreement with the Founder 1
in the form attached hereto as Annex 25."
c. Paragraph 5 shall be deleted in its entirety
--------------------------------------------
E. TABLE: LIST OF ANNEXES TO THE PARTICIPATION AGREEMENT shall be replaced with
----------------------------------------------------------------------------
the following:
--------------
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List of Annexes
---------------
to the
------
Participation Agreement
-----------------------
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------------------------
Annex 1 Signed Term Sheet of June 16,1998
- --------------------------------------------------------------------------------------------------
Annex 2 Business Plan in the version of July 30, 1998
- --------------------------------------------------------------------------------------------------
Annex 3 Minutes from the shareholders' meeting of June 10, 1998
including the Articles of Association
- --------------------------------------------------------------------------------------------------
Annex 4 Excerpt from the Trade Register
- --------------------------------------------------------------------------------------------------
Annex 5 List of Shareholders
- --------------------------------------------------------------------------------------------------
Annex 6 Shareholdings in other Companies Which Are Active in
the Field of the Company or a Related Field or Are in a
Business Relationship with the Company
- --------------------------------------------------------------------------------------------------
Annex 7
- --------------------------------------------------------------------------------------------------
Annex 8 Obligations of the Company Exceeding DM 50,000
- --------------------------------------------------------------------------------------------------
Annex 9
- --------------------------------------------------------------------------------------------------
Annex 10 Draft of the New Articles of Association
- --------------------------------------------------------------------------------------------------
Annex 11 Employment Contracts for the General Manager(s)
- --------------------------------------------------------------------------------------------------
Annex 12 Employment Contract
- --------------------------------------------------------------------------------------------------
Annex 13 Void
- --------------------------------------------------------------------------------------------------
Annex 14 Void
- --------------------------------------------------------------------------------------------------
Annex 15 Void
- --------------------------------------------------------------------------------------------------
Annex 16 Void
- --------------------------------------------------------------------------------------------------
Annex 17 Rights of Preferred Stock
- --------------------------------------------------------------------------------------------------
</TABLE>
[*] Confidential treatment requested
<PAGE>
<TABLE>
<S> <C>
- --------------------------------------------------------------------------------------------------
Annex 18 Letter of Intent (BMBF)
- --------------------------------------------------------------------------------------------------
Annex 19 Letter of Intent (Senate of Berlin)
- --------------------------------------------------------------------------------------------------
Annex 20 Void
- --------------------------------------------------------------------------------------------------
Annex 21 Void
- --------------------------------------------------------------------------------------------------
Annex 22 List of Existing Licensees
- --------------------------------------------------------------------------------------------------
Annex 23 License Agreement
- --------------------------------------------------------------------------------------------------
Annex 24 Manufacturing and Supply Agreement and Sub-License
Agreement
- --------------------------------------------------------------------------------------------------
Annex 25 Service Agreement
- --------------------------------------------------------------------------------------------------
Annex 26 Cap Table
- --------------------------------------------------------------------------------------------------
Annex 27 Liens
- --------------------------------------------------------------------------------------------------
Annex 28 Bank Accounts of the Company
- --------------------------------------------------------------------------------------------------
Annex 29 List of Employees
- --------------------------------------------------------------------------------------------------
</TABLE>
II. ENTIRE AMENDMENT:
This Amendment, to the extent set forth herein, amends and
modifies and supplements the Agreement. Except as expressly amended
herein, all of the terms and provisions of the Agreement remain in full
force and effect and cannot be amended, modified or changed in any way
except in writing witnessed and signed by duly authorized representatives
of each Company, Founders and the Investor.
III. GENERAL PROVISION:
While both a German and an English version of this Amendment exist, only
the English version of this Amendment shall be binding, and the German
version of this Amendment shall not be used for any legal purpose,
interpretive or otherwise.
[*] Confidential treatment requested
<PAGE>
IN WITNESS WHEREOF, the Parties have caused this Amendment to be executed by
their duly authorized representatives.
November 23, 1998
--
Larry Bullock
---------------------------------------------
RIBOZYME PHARMACEUTICALS INC.
Founder 1
/s/ Ralph E. Christoffersen
---------------------------------------------
Dr. Ralph Earl Christoffersen
Founder 2
/s/ Larry Bullock
---------------------------------------------
Mr. Larry Bullock
Founder 3
/s/ Nassim Usman
---------------------------------------------
Dr. Nassim Usman
Founder 4
/s/ James Thompson
---------------------------------------------
Dr. James Thompson
Founder 5
/s/ Alene Holzman
---------------------------------------------
Ms. Alene Holzman
Founder 6
/s/s Thomas Rossing
---------------------------------------------
Dr. Thomas Rossing
Founder 7
November __, 1998
BB BIOVENTURES L.P.
By: /s/ Ansbert S. Gadicke
----------------------
[*] Confidential treatment requested
<PAGE>
Name: Ansbert S. Gadicke
------------------
Title: Managing Director
-----------------
November 23, 1998
--
/s/ Jorg Potzsch
---------------------------------------------
Dr. Jorg Potzsch
Founder 8
/s/ Thomas Walther
---------------------------------------------
Dr. Thomas Walther
Founder 9
/s/ Ralph E. Christoffersen
---------------------------------------------
Atugen Biotechnology GmbH
Company
[*] Confidential treatment requested
<PAGE>
Exhibit 99.3
CONFIDENTIAL PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO REGULATION
240.24B-2B OF THE SECURITIES EXCHANGE ACT OF 1934. [*] INDICATES OMITTED
MATERIAL THAT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST AND IS FILED
SEPARATELY WITH THE COMMISSSION.
LICENSE AGREEMENT
-----------------
This License Agreement (the "Agreement") is made and entered into as of this
23rd day of November, 1998 ("Effective Date"), by and between Ribozyme
Pharmaceuticals Incorporated, a Delaware corporation with offices located at
2950 Wilderness Place, Boulder, CO 80301 (hereinafter "RIBOZYME") and ATUGEN
organized under the laws of Germany, and having its principal office in Berlin,
Germany (hereinafter ATUGEN) (together, the "Parties").
WHEREAS, RIBOZYME is engaged in research, development and commercialization of
certain patented and/or proprietary nucleic acid technology for therapeutic,
agricultural, animal health, diagnostic and functional genomics applications
(the "RIBOZYME Technology");
WHEREAS, RIBOZYME has the right to grant licenses under the RIBOZYME Patent
Rights (as hereinafter defined);
WHEREAS ATUGEN is interested in conducting research, development and
commercialization activities in the field of Target Validation and Discovery
(TVD), as more fully described in the Business Plan of July 30, 1998 and a
certain Participation Agreement which is incorporated by reference herein;
WHEREAS, ATUGEN desires to obtain from RIBOZYME, and RIBOZYME is willing to
grant, certain rights in and to RIBOZYME Patent Rights, as defined herein, and
certain aspects of the RIBOZYME TECHNOLOGY; and
WHEREAS, RIBOZYME is sublicensing to ATUGEN rights to the Cech Patents (as
defined herein) pursuant to a separate Manufacturing and Supply Agreement and
Sublicense Agreement of even date herewith (the "Sublicense").
NOW THEREFORE, in consideration of the mutual covenants herein contained and
intending to be legally bound hereby, the Parties hereto agree as follows:
[*] Confidential treatment requested
1
<PAGE>
Section 1
DEFINITIONS
1.1 "Affiliate" shall mean any corporation or other business entity controlled
---------
by, controlling, or under common control with ATUGEN. For purpose of this
Section 1.1, "control" shall mean direct or indirect beneficial ownership
of more than thirty percent (30%) of the voting stock or equity, or more
than thirty percent (30%) interest in the income of such corporation or
other business entity.
1.2 "Acquirer" shall mean an entity that intends to or does gain control of
--------
RIBOZYME operations.
1.3 "ATUGEN Invention" shall have the meaning set forth in the Section 3.1.1
1.4 "ATUGEN Patent Rights" shall mean, collectively, all right, title and
--------------------
interest of ATUGEN in, to and under (i) Patents covering ATUGEN Inventions
and (ii) Patents to which ATUGEN is a licensee with the right to sublicense
rights thereunder to RIBOZYME.
1.5 "Cech Patents" shall mean the inventions and discoveries which are the
------------
subject of, or which are covered in whole or in part by, the claims
included in (i) U.S. Patent Application Serial Number 937,327, filed
December 3, 1986 entitled RNA RIBOZYME POLYMERASES, DEPHOSPHORYLASES,
RESTRICTION ENDORIBONUCLEASES AND METHODS (the "'327 Patent Application"),
(ii) the United States Patents listed in Appendix A, and any patents
issuing thereon as well as any corresponding patent applications or any
patents that may issue thereon throughout the world, including any
extensions, renewals, divisions, continuations, continuations-in-part,
patents of addition, and/or reissues thereof, including any patent
application and any patents issuing thereon throughout the world, including
any extensions, renewals, continuations, continuations-in-part, divisions,
patents of additions and/or reissues thereof, filed upon any invention the
practice of which would infringe the claims covered by the foregoing
patents, which invention was made by Thomas R. Cech, Arthur J. Zaug and
Michael D. Been, and/or persons acting under their direction and control at
the University of Colorado, which is the work product of the Research
Support Funding Agreement between USB and the University of Colorado
Foundation entered into on May 20, 1987 (the "RSFA") and which was
conceived or reduced to practice during the term of the RSFA.
1.6 "Change of Control of RIBOZYME" shall mean a merger or acquisition by,
-----------------------------
with or of RIBOZYME in which the equity holders of RIBOZYME immediately
prior to such event do not hold at least 51% of the equity of the resulting
entity, and a single new Acquirer controls at least 51% of the equity
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of the resulting entity or the sale of all or substantially all the assets
of RIBOZYME to a third party.
1.7 "COGS" means RIBOZYME's fully-burdened cost of supplying Nucleic Acid
----
Molecules, Delivery Reagents and other reagents to ATUGEN, including raw
materials, direct labor, quality control testing, labeling, packaging and
shipping costs, calculated in accordance with RIBOZYME's accounting methods
consistently applied and in compliance with U.S. generally accepted
accounting principles (GAAP)
1.8 "Collaborator" shall mean any entity or person engaged in an active
------------
research and development collaboration with ATUGEN in its Target Validation
and Discovery program.
1.9 "Combination Patents" shall have the meaning set forth in section 3.2.4.
1.10 "Confidential Information" shall mean confidential and proprietary
------------------------
information of ATUGEN or RIBOZYME, including without limitation scientific
data, technical reports and business information, disclosed to the other
Party, provided that such information is in writing and marked
"CONFIDENTIAL" or with a similar legend, or is disclosed orally and is
reduced to writing and marked "CONFIDENTIAL" or with a similar legend
within 30 days after such disclosure.
1.11 "Delivery Reagents" shall mean all RIBOZYME's reagents useful for the
-----------------
delivery of Nucleic Acid Molecules to cells that are covered under RIBOZYME
Patent Rights or RIBOZYME TECHNOLOGY.
1.12 "Escrow Technology" shall have the meaning provided under Section 8.7.
-----------------
1.13 "Excluded Patents List" shall have the meaning set forth in Section 3.2.4
1.14 "Existing Licensee" shall mean third parties to whom RIBOZYME has already
-----------------
granted certain licenses under RIBOZYME Patent Rights in the Field each of
which is listed in the enclosed Appendix B.
1.15 "Existing Rights" shall have the meaning set forth in section 3.2.5.
1.16 "Field" shall mean any and all applications of Nucleic Acid molecules in
-----
the field of human therapeutic Target Validation and Discovery. Such Field
will include functional genomics or gene function identification in human
systems, in which the function of a gene is determined by using a Nucleic
Acid Molecule. The Field shall also include use of Nucleic Acid Molecules
to validate a human therapeutic target.
1.17 "Invention" shall mean any possibly patentable discovery or invention that
---------
is conceived and reduced to practice.
1.18 "Investor" shall mean BB BioVentures, L.P., and its affliates, all of whom
--------
are managed by MPM Asset Management, LLC., an affiliate of MPM Capital LP.
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1.19 "Licensed Technology" shall mean any technology that is either: (i)
-------------------
covered by RIBOZYME Patent Rights; or (ii) constitutes Non-Patented
Technology ; provided however, Excluded Patents as defined in section 3.2.5
herein, shall not be included under Licensed Technology as provided in that
section.
1.20 "Licensed Technology List" shall have the meaning provided under section
3.2.5.
1.21 "Lipid Market Price" shall mean the average arms-length retail selling
------------------
cost of the two market leading reagents for cell-based transfection. These
two market leading reagents shall be identified based on mutual agreement
of the Parties.
1.22 "New Invention" shall mean any possibly patentable discovery or invention
-------------
conceived and/or reduced to practice by RIBOZYME AND/or ATUGEN in the
Field, or by ATUGEN in the RIBOZYME Field.
1.23 "Non-Patented Technology" means know-how, trade secrets or other
-----------------------
information or materials that are not patentable or, for a possibly
patentable discovery or invention, on which the parties choose not to file
a patent, which are either: (i) made under this Agreement; or (ii) are
owned or controlled by RIBOZYME on the date of this Agreement and are
useful or necessary to ATUGEN in the Field, except for know-how, trade
secrets or other information or materials that cannot be used, practiced,
performed, made or sold without infringing on the Cech Patents.
1.24 "Nucleic Acid Molecules" shall mean enzymatic nucleic acid molecules,
----------------------
GeneBlock (TM) reagents or nucleic acid probes. The term Nucleic Acid
Molecules, as used herein, shall not include [*]
1.25 "Nucleic Acid Product" means any substance that (i) is or is intended to be
--------------------
developed and sold commercially for administration to humans or animals or
plants or for therapeutic or diagnostic use and (ii) contains a non-
protein, non-peptide encoding oligonucleotide, including, but not limited
to, Nucleic Acid Molecules.
1.26 "Oligonucleotide Market Price" [*]
----------------------------
1.27 "Participation Agreement" shall mean the participation agreement of August
------------------------
24, 1998, and all amendments thereof, executed by ATUGEN and founders of
ATUGEN, including RIBOZYME.
1.28 "Patents" shall mean (i) patents (including inventor's certificates) that
-------
include one or more Valid Claims, including without limitation any
substitution, extension (including supplemental protection certificate),
registration, confirmation, reissue, reexamination or renewal thereof, (ii)
pending applications, including provisional applications, continuations,
divisionals,
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and continuations-in-part of any of the foregoing.
1.29 "Patent Right" shall mean RIBOZYME and/or ATUGEN Patent Rights.
------------
1.30 "RIBOZYME Patent Rights" shall mean collectively, all right, title and
----------------------
interest of RIBOZYME in, to and under those Patents which cover a RIBOZYME
Invention or which are listed in the Licensed Technology List provided
under section 3.2.5, herein. RIBOZYME Patent Rights, however, shall not
include the Cech Patents and the Patents shall not be RIBOZYME Patent
Rights while on the Excluded Patents List.
1.31 "RIBOZYME Field" shall mean any and all applications of Nucleic Acid
--------------
Molecules, including but not limited to, as a human or animal therapeutic
or diagnostic products or an agricultural product but excluding any
application of Nucleic Acid Molecules in the Field of Target Validation and
Discovery (TVD).
1.32 Ribozyme Invention" shall have the meaning set forth in Section 3.1.1.
1.33 "RIBOZYME's Supply Profit" [*]
------------------------
1.34 "Service Agreement" shall mean the Service Agreement between ATUGEN and
-----------------
RIBOZYME dated November 23, 1998, and any amendment(s) thereof, all of
which are incorporated by reference herein.
1.35 "Target" means a gene or partial sequence thereof, and those elements
------
necessary for its expression or regulation, or its transcription,
translation, or replication product or intermediates or portions thereof.
1.36 "Target Discovery Technology" shall have the meaning provided in the ATUGEN
---------------------------
Business Plan of July 30, 1998.
1.37 "Target Validation and Discovery ("TVD")" means a research program in
---------------------------------------
which a nucleic acid molecule, including Nucleic Acid Molecules, is used to
determine the utility of a gene or gene product, as a therapeutic or a
therapeutic target, and/or for the discovery of genes or gene products as
potential therapeutics or therapeutic targets or as tools for the
identification of potential therapeutics or therapeutic targets. Such a
program is usually performed on behalf of a third party Collaborator, but
may be performed solely for ATUGEN's benefit or may consist of technology
rights which are licensed or sold to third parties for use in their own
non-Nucleic Acid-Molecule-based product development programs outside the
RIBOZYME Field.
1.38 "TVD Patents" shall have the meaning set forth in section 3.2.4.
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1.39 "Validated Target" shall mean a Target that has been validated in vitro
----------------
or in vivo as part of a TVD program by ATUGEN or its Collaborator.
1.40 "Valid Claim" shall mean either (i) a claim of an issued and unexpired
-----------
patent included within the Patent Rights, provided that such claim has not
been held permanently revoked, unenforceable or invalid by a decision of a
court or other governmental agency of competent jurisdiction, unappealable
or unappealed within the time allowed for appeal, and has not been admitted
to be invalid or unenforceable through reissue, disclaimer or otherwise, or
(ii) a claim of a patent application within the Patent Rights actively
being prosecuted.
Section 2
GRANT AND CONSIDERATIONS
2.1 Grant to ATUGEN.
---------------
2.1.1 RIBOZYME hereby grants to ATUGEN an exclusive, with a right to sub-
license as set forth in section 2.1.2 below, worldwide ("Territory")
right and license to the RIBOZYME Patent Rights, and Non Patented
Technology for the duration of the Term:
(i) to develop, promote, market, distribute, use, sell, offer
to sell or otherwise dispose of, use and import Licensed
Technology in the Field; and
(ii) to practice and use methods and processes described or
claimed in the RIBOZYME Patent Rights within the Field.
Notwithstanding the foregoing, such license shall be co-exclusive
with respect to RIBOZYME to the extent that RIBOZYME uses the
RIBOZYME Patent Rights and Non-Patented Technology solely for the
following purposes:
(a) for RIBOZYME's internal research purposes;
(b) to serve the Existing Licensees, if applicable, in the
Field, provided that no rights may be granted to any
Existing Licensee to any New Invention for use in the Field
unless RIBOZYME is currently contractually obligated to do
so, as of August 24, 1998;
(c) for use in collaboration(s) with third parties to conduct
research, develop and commercialize human therapeutic
Nucleic Acid Products, where such use, with each such third
party collaborator, will involve, over any given six-month
period, examination of no more than five (5)
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Targets for each disease indication. RIBOZYME, however,
will not use the Target Discovery Technology to identify
new Targets in the Field under a collaboration with a third
party nor shall RIBOZYME permit any such third party to
conduct any of its own discovery efforts using the Target
Discovery Technology. It is also understood and agreed by
the parties that RIBOZYME shall not develop its own TVD
program using any ATUGEN Patent Rights or any RIBOZYME
Patent Rights or any Non-Patented Technology in the Field
licensed to ATUGEN herein, subject to the provisions of
this Section 2.1.1.
2.1.2 ATUGEN shall have no right to grant sublicenses to any Licensed
Technology, other than Licensed Technology sold or licensed by ATUGEN
in the regular course of its business in the Field or pursuant to a
collaborative drug development or discovery agreement with a third
party in the Field but subject in all cases to the limitations of
Section 2.1.7. Such sublicensee shall not have the right to further
sublicense any Licensed Technology under this Agreement without
RIBOZYME's prior written consent, which consent shall not be
unreasonably withheld, particularly in the case of territorial
sublicenses by a collaborative partner.
2.1.3 RIBOZYME agrees to use reasonable best efforts to prosecute and
obtain issuance of any and all pending patent applications under the
RIBOZYME Patent Rights. Notwithstanding the foregoing, RIBOZYME shall
not be liable for failure to obtain issued patents for the pending
applications. ATUGEN shall have the right to prosecute any Patents
that RIBOZYME decides not to prosecute in the United States and
ATUGEN shall bear the cost of prosecuting such Patents.
2.1.4 RIBOZYME agrees not to grant licenses under RIBOZYME Patent Rights in
the Field to a third party other than pursuant to its existing
agreements with the Existing Licensees.
2.1.5 RIBOZYME hereby grants to ATUGEN an exclusive, royalty free worldwide
fully paid-up right and license, with no right to sub-license other
than as provided in Section 2.1.2 above, to new Inventions covered
under RIBOZYME Patent Rights, including RIBOZYME Inventions, and Non
Patented Technology owned by RIBOZYME in the Field, for the duration
of the Term (i) to develop, promote, market, distribute, use, sell,
offer to sell or otherwise dispose of, use and import such New
Inventions solely in the Field, and (ii) to practice and use methods
and processes described or claimed in such New Inventions solely
within the Field.
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2.1.6 ATUGEN hereby grants to RIBOZYME at no cost to RIBOZYME, an
exclusive, royalty free worldwide right and license, with a right to
sublicense (as provided below), to New Inventions covered under
ATUGEN Patent Rights, including ATUGEN Inventions, and Non Patented
Technology owned by ATUGEN in the RIBOZYME Field, until there are no
Valid Claims in existence: (i) to develop, promote, market,
distribute, make, have made, use, sell, offer to sell or otherwise
dispose of, use and import such New Invention solely in the RIBOZYME
Field, (ii) to practice and use methods and processes described or
claimed in such New Inventions solely within the RIBOZYME Field;
(iii) to serve the Existing Licensees if required by an existing
agreement with an Existing Licensee, which was effective as of August
24, 1998. RIBOZYME may not sublicense or otherwise transfer any
ATUGEN Patent Rights or ATUGEN Inventions to a third party, except in
connection with a collaborative agreement with a third party for the
development of a Nucleic Acid Product in the RIBOZYME Field but
solely for the purpose of developing, commercializing, testing,
validating, making and selling such Nucleic Acid Product.
2.1.7 Notwithstanding the foregoing, RIBOZYME shall retain an exclusive
right to develop and commercialize Nucleic Acid Products in the
RIBOZYME Field. ATUGEN agrees, that it will clearly stipulate in its
TVD Agreements that RIBOZYME shall retain an exclusive right to
develop and commercialize Nucleic Acid Products against the Validated
Target identified under such TVD Agreements. ATUGEN shall provide a
list of Validated Targets to RIBOZYME once every quarter; provided
however, that in the event of Change of Control of RIBOZYME as set
forth in section 8.8, ATUGEN will not be required to provide such
list to RIBOZYME or its successor.
2.1.8 RIBOZYME will transfer its contracts with the Existing Licensees to
ATUGEN under a separate Service Agreement which is incorporated by
reference herein, provided such transfer is legally possible and the
Existing Licensees agree to such a transfer. RIBOZYME agrees to use
its best efforts to obtain such approvals.
2.1.9 The parties recognize that the rights granted to RIBOZYME by ATUGEN
under this Agreement might be restricted according to the principles,
guidelines, conditions and collateral provisions of public or semi-
public German entities providing or intending to provide grants to
ATUGEN, and the Parties will comply with them.
2.2 Consideration.
-------------
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2.2.1 As a consideration for the rights and license granted to ATUGEN
hereunder, ATUGEN will pay to RIBOZYME a one-time technology access
fee of two million U.S. dollars (US $2 million) (the "License Fee");
provided, however, that in the event that RIBOZYME has not, by
December 28, 1998, obtained either: (i) the release of the liens set
forth in the schedule of exceptions provided to the Investor
("Liens"); or (ii) the subordination of the Liens to this License
Agreement and the Manufacturing and Supply Agreement and Sub-license
Agreement, in a form reasonably satisfactory to ATUGEN, then the
amount of the License Fee shall be reduced by an amount equal to the
aggregate outstanding principal balance plus the aggregate interest
owed upon the debt underlying the Liens ("Debts"). In the event of
such a reduction, ATUGEN will use the difference between US $2M and
the adjusted License Fee to repay the Debts and to release the Liens.
2.2.2 All payments to be made to RIBOZYME by ATUGEN under this Section 2
shall be due on or before December 31, 1998. Checks for all payments
to RIBOZYME under this Agreement shall be deposited in the following
bank account of RIBOZYME.
Name of the Bank: Norwest Bank of Denver
Address: 1740 Broadway Street, Denver, CO 80204
[*]
For further credit to Norwest Bank of Boulder, Ribozyme
Pharmaceuticals Inc.,
Account No.: [*]
2.2.3 In the event that any payment due to RIBOZYME by ATUGEN is
delinquent, interest shall accrue on any overdue amount at the rate
of one percent (1%) per month or the maximum rate permitted by law,
whichever is less.
Section 3
PATENT PROSECUTION, ENFORCEMENT AND DEFENSE
3.1 Inventorship.
------------
3.1. Any New Invention that is made (i) solely by one or more
representatives of RIBOZYME shall be deemed invented solely by
RIBOZYME (a "RIBOZYME Invention"); (ii) solely by one or more
representatives of ATUGEN shall be deemed invented solely by ATUGEN
(an "ATUGEN Invention"); and (iii) jointly by one or more
representatives of RIBOZYME and one or more representatives of ATUGEN
shall be deemed invented jointly by RIBOZYME and ATUGEN (a "Joint
Invention"). Any Non-Patented Technology that is made (i) solely by
one or more representatives of RIBOZYME shall be deemed invented
solely by RIBOZYME, (ii) solely by one or more
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representatives of ATUGEN shall be deemed invented solely by ATUGEN;
and (iii) jointly by one or more representatives of RIBOZYME and one
or more representatives of ATUGEN shall be deemed invented jointly by
RIBOZYME and ATUGEN. Determination of inventorship shall be made in
accordance with the patent laws of the United States of America.
3.1.2 In the event of a dispute concerning inventorship between RIBOZYME
and ATUGEN, the Parties hereby agree that each will attempt to
resolve such dispute by agreement between two U.S. patent attorneys
(one chosen by each Party) according to U.S. patent laws. If those
two attorneys fail within 30 days to reach a resolution, then the
Parties agree to reach a binding agreement by negotiation between
those two attorneys and a third patent attorney chosen by those two
attorneys. The three attorneys will reach a binding agreement with
regard to the dispute by a majority vote of the three attorneys. Such
dispute will be resolved in this manner within 60 days from the date
of the initial dispute.
3.2 Patent Management.
-----------------
3.2.1 The Party owning the Invention shall be responsible for the
preparation, filing, prosecution, and maintenance (the "Patent
Management") of a Patent (the "Filing Party"), subject to the
provisions of Section 3.2.2.
3.2.2 ATUGEN, at its expense, shall take any and all actions necessary with
respect to the Patent Management of Patents, for any ATUGEN
Inventions discovered or identified as a result of any TVD program.
RIBOZYME shall take any and all actions necessary with respect to the
Patent Management of Patents for all other Inventions arising out of
or in connection with this Agreement including Patents claiming
Nucleic Acid Molecules or Delivery Reagents discovered or identified
other than as a result of a TVD program. ATUGEN has the right to
pursue prosecution of those New Inventions or Joint Inventions, which
RIBOZYME chooses not to pursue, at ATUGEN's expense, and RIBOZYME has
the right to pursue prosecution of those ATUGEN Inventions, which
ATUGEN chooses not to pursue, at RIBOZYME's expense.
3.2.3 Each Party agrees to cooperate fully in the Patent Management of any
Patent Rights under this Agreement. Such cooperation includes, but is
not limited to: (i) turning over to the Filing Party all files,
papers and documents relating to such Patent; (ii) executing all
papers and instruments, or requiring its employees or agents, to
execute such
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papers and instruments, so as to effectuate the ownership of Patent
Rights as set forth herein and to enable the other Party to apply for
and to prosecute Applications in any country; and (iii) promptly
informing the other Party of any matters coming to such Party's
attention that may affect the Patent Management of any such
Application. Each Party will notify the other Party promptly of any
New Inventions developed solely or jointly by the Parties.
3.2.4 ATUGEN shall pay to RIBOZYME all expenses, including the attorneys'
fees, relating to the prosecution, maintenance, defense and
enforcement of Licensed Technology ("Patent Expense") according to
the following schedule:
(1) For that portion of the Licensed Technology which is applicable
only to the TVD activities of Atugen ("TVD Patents"), Atugen
shall pay [*] of the Patent Expenses.
(2) For that portion of Licensed Technology which is applicable both
to the TVD activities of Atugen and RIBOZYME activities in the
Ribozyme Field ("Combination Patents"), Atugen shall pay [*] of
the Patent Expenses; and
(3) For all Ribozyme Patent Rights that are neither TVD Patents nor
Combination Patents, Atugen shall not be obligated to pay any
Patent Expense and such Patents shall be excluded from the
Licensed Technology herein ("Excluded Patents").
3.2.5 The categories of Licensed Technology set forth in the foregoing
section 3.2.4 shall be determined according to the following
procedure:
(1) Within forty-five (45) days following the signing of this
Agreement, RIBOZYME shall provide to ATUGEN a written list of
RIBOZYME Patent Rights, divided into the three categories listed
under section 3.2.4. ATUGEN then will have one hundred and twenty
(120) days to indicate to RIBOZYME in writing: (i) if the list is
acceptable; and (ii) which of the proposed TVD Patents and
Combination Patents ATUGEN wishes to exclude from Licensed
Technology and therefore to have them included in the Excluded
Patents list. RIBOZYME shall have no obligation to continue
prosecuting any Patents in the Excluded Patents list. RIBOZYME
then shall provide to ATUGEN a new list of Licensed Technology
without the Excluded Patents and this list shall be the "Licensed
Technology List".
(2) RIBOZYME shall provide in writing to ATUGEN an updated list of
Licensed Technology once every twelve months, wherein the updated
list will include: (i) all of the Ribozyme Patent Rights then on
the Licensed Technology List ("the Existing Rights"); and (ii)
all the new Patents filed by RIBOZYME in the Field, that are
available for inclusion in the Licensed Technology List. ATUGEN
then will have thirty (30) days to indicate to RIBOZYME in
writing as to: (a) which of the Existing Rights in the updated
Licensed Technology List that ATUGEN wishes to remove; and (b)
which new Patents ATUGEN wishes to pay Patent Expense for
according to the schedule set forth under 3.2.6, and thereby keep
such new Patents on the Licensed
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Technology List. The Existing Rights which ATUGEN wishes to
remove from the Licensed Technology List and the new Patents for
which ATUGEN does not wish to pay Patent Expense will be added to
the Excluded Patents list. If ATUGEN does not respond within
thirty (30) days, as required under this paragraph 2, then the
new Patents will be automatically be included in the Licensed
Technology List as proposed and the Existing Rights will all
remain on the Licensed Technology List. All new Patents added to
the Licensed Technology List, through ATUGEN's election under
this Agreement, shall be considered Ribozyme Patent Rights for
the purposes of this Agreement.
(3) Except for the annual updates provided above, and the re-entry
provisions described below, the Licensed Technology List shall
not be amended without a mutual written agreement of the Parties.
(4) If ATUGEN wishes to add to the Licensed Technology List, one or
more Excluded Patents, it shall make a written request to
RIBOZYME indicating the specific Excluded Patents it wants added
to the Licensed Technology List ("Re-entry Patents"). RIBOZYME
shall add these Re-entry Patents to the Licensed Technology List,
if such Patents are still in existence and/or have not been
exclusively licensed to a third party pursuant to a license which
would prohibit a license to ATUGEN hereunder. At such time as
ATUGEN requests the Re-entry of a Patent and makes the
appropriate payments to RIBOZYME, such Re-Entry Patents will
thereafter be included in the Licensed Technology. The addition
of Re-entry Patents shall be according to the following
provisions:
(a) ATUGEN shall pay [*] of all Patent Expense incurred on the
Re-entry Patents as of the date of Re-entry and pay [*] of
all Patent Expense to be incurred in the future on such Re-
entry Patents, provided such Re-entry Patents are TVD
Patents;
(b) ATUGEN shall pay [*]of all Patent Expense incurred on all
other Re-entry Patents as of the date of Re-entry and pay
[*] of all Patent Expense incurred in the future on such Re-
entry Patents.
(5) All payments to be made by ATUGEN under this Section, shall be
sent to RIBOZYME within thirty (30) days of its receipt of an
invoice from RIBOZYME. The payments will be made in accordance
with the provisions of Section 2.2.2 above.
3.3 Defense. In the event of any claim(s) against ATUGEN, arising within two
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(2) years after August 19, 1998, for
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infringement of any intellectual property right of any third party as a
direct result of the exercise of the right and license granted by RIBOZYME
to ATUGEN hereunder, RIBOZYME shall indemnify and hold harmless ATUGEN, its
officers, directors, licensees and assigns from any and all such claims,
provided, however, that RIBOZYME's liability under this Section 3.3 and
Section 3.3 of the Sublicense shall not exceed U.S. $8.5 million RIBOZYME
shall have sole control of any such legal action or settlement negotiations
and shall have the right to settle any such litigation by grant of any
rights to the third party provided ATUGEN approves of such grant, which
approval shall not be unreasonably withheld. ATUGEN agrees to assist
RIBOZYME in defending such claims.
3.4 Patent Enforcement. RIBOZYME and ATUGEN shall each provide immediate
------------------
written notice to the other of any infringement of the RIBOZYME Patent
Rights, which may come to such Party's attention. RIBOZYME shall have the
exclusive right to institute and conduct commercially reasonable legal
action against third party infringers of the RIBOZYME Patent Rights in the
Field, or negotiate and enter into settlement agreements as deemed
appropriate by RIBOZYME after consultation with ATUGEN if necessary.
ATUGEN shall provide RIBOZYME with reasonable assistance in any action
taken by RIBOZYME to enforce the RIBOZYME Patent Rights. ATUGEN shall not,
however be entitled to join RIBOZYME as a Party to any such action. Any
award of damages resulting from action taken by RIBOZYME pursuant to this
Section 3.4, after reimbursement of expenses incurred by RIBOZYME and
ATUGEN, respectively in connection with such action, shall be divided
equally between the parties, provided that such infringement was deemed to
have occurred in the Field and specifically involved the Licensed
Technology. ATUGEN shall have the exclusive right to institute and conduct
commercially reasonable legal action against third party infringers of the
ATUGEN Patent Rights, or negotiate and enter into settlement agreements as
deemed appropriate by ATUGEN after consultation with RIBOZYME if necessary.
RIBOZYME shall provide ATUGEN with reasonable assistance in any action
taken by ATUGEN to enforce the ATUGEN Patent Rights. RIBOZYME shall not,
however be entitled to join ATUGEN as a Party to any such action. Any award
of damages resulting from action taken by ATUGEN pursuant to this Section
3, after reimbursement of expenses incurred by ATUGEN in connection with
such action, shall be divided equally between the parties.
3.5 Counsel. In order for RIBOZYME to prosecute, enforce and litigate the
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RIBOZYME Patent Rights discussed in this Section 3, it shall hire counsel
of its own choice, but reasonably acceptable to ATUGEN, to represent
RIBOZYME in such actions. Such counsel may be granted a power of attorney
by inventors of ATUGEN solely for convenience of prosecution and
litigation. It is understood however that such counsel will not represent
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ATUGEN or inventors of ATUGEN, and that ATUGEN is free to obtain counsel of
its own choice at its own cost to review the work of RIBOZYME's counsel,
and to have input into the ongoing prosecution, maintenance, and litigation
of RIBOZYME Patent Rights. RIBOZYME shall instruct its counsel to copy
ATUGEN directly on all correspondence relating to prosecution of RIBOZYME
Patent Rights.
Section 4
CONFIDENTIALITY
4.1 Confidential Information. Any Party receiving any Confidential Information
------------------------
from the other Party in connection with the execution, delivery and
performance of this Agreement shall keep, and shall cause its affiliates,
officers, employees, students, technicians, advisors and consultants to
keep, all such Confidential Information in confidence and shall not disclose
such Confidential Information to third parties, except in connection with a
license, sublicense or sale permitted hereunder requiring such disclosure
and containing appropriate confidentiality provisions.
4.2 Inapplicability. The obligations of confidentiality and nonuse set forth
---------------
in this Agreement shall not apply to any portion of the Confidential
Information which:
(1) is or becomes public or available to the general public otherwise than
through the act or default of the receiving Party or its affiliates or
their employees, advisors or consultants; or
(2) is obtained by the receiving Party from a third party without a duty
of confidentiality who is lawfully in possession of such Confidential
Information and is not subject to an obligation of confidentiality
owed to the other Party or others; or
(3) is known, as shown by competent evidence, by the receiving Party or
any of its affiliates prior to disclosure under this Agreement and was
not obtained or derived directly or indirectly from the other Party;
or
(4) is disclosed by the receiving Party or its affiliates pursuant to a
requirement of law, provided that such Party has complied with the
provisions set forth in paragraph 4.3.
4.3 Notice Prior to Disclosure. If the receiving Party, sublicensees or any of
--------------------------
its Affiliates becomes legally required to disclose any Confidential
Information, the receiving Party shall give the other Party to this
Agreement prompt notice of such fact so that such Party may obtain a
protective order or other appropriate remedy concerning any such disclosure
and/or waive compliance with the non-disclosure provisions of this
Agreement. The receiving Party and its Affiliates will fully cooperate with
the other Party to this Agreement
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in connection with such Party's efforts to obtain any such order or other
remedy. If any such order or other remedy does not fully preclude
disclosure or the other Party to this Agreement waives such compliance, the
receiving Party and its affiliates will make such disclosure only to the
extent that such disclosure is legally required and will use its best
efforts to have confidential treatment accorded to the disclosed
Confidential Information. Notwithstanding the foregoing provisions, ATUGEN
will be free to disclose the terms of this Agreement to a third party,
including ATUGEN's Collaborators and potential investors, under
confidentiality with such third parties.
4.4 Term. The obligations of ATUGEN and RIBOZYME under this Section 4 shall
----
continue for a period of five (5) years after the expiration of this
Agreement.
4.5 Return of Materials. Upon expiration or termination of this Agreement,
-------------------
each Party shall return all copies of Confidential Information disclosed to
such Party, and all other materials provided to such Party under this
Agreement; provided that one copy of such Confidential Information and such
materials may be retained for archival or legal purposes only.
Section 5
LIABILITY AND INDEMNIFICATION
5.1 Indemnification by ATUGEN. ATUGEN agrees to indemnify, hold harmless and
-------------------------
defend RIBOZYME, its officers, employees, and agents, against any and all
claims, suits, losses, damages, costs, fees, and expenses asserted by third
parties, both government and non-government, resulting from or arising out
of any product manufactured or sold or service performed by ATUGEN pursuant
to the exercise of this license, other than claims covered by RIBOZYME's
indemnification in Section 3.3 above. ATUGEN shall not be responsible for
the negligence or intentional wrong doing of RIBOZYME.
5.2 Insurance. ATUGEN shall maintain in force at its sole cost and expense,
---------
with reputable insurance companies, general liability insurance and
products liability insurance coverage in an amount reasonably sufficient to
protect against liability under paragraph 5.1 above. RIBOZYME shall have
the right to ascertain from time to time that such coverage exists, such
right to be exercised in a reasonable manner.
5.3 Force Majeure. The Parties will not be liable for any failure to perform
-------------
as required by this Agreement, to the extent such failure to perform is
caused by any reason beyond the control of either Party, or by reason of
any of the
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following: labor disturbances or disputes of any kind, accidents,
governmental policy, civil disorders, acts of aggression, acts of God,
energy or other conservation measures, failure of utilities, mechanical
breakdowns, material shortages, disease or similar occurrences.
Section 6
REPRESENTATIONS AND WARRANTIES
6.1 Representations of RIBOZYME. RIBOZYME represents that RIBOZYME has the
---------------------------
legal right, authority and power to enter into this Agreement and meet the
obligations set forth herein. RIBOZYME further represents that it has not
previously granted other than the rights previously granted to Existing
Licensees, and will not grant to any third party during the term of this
Agreement, any rights under the RIBOZYME Patent Rights or Inventions that
are inconsistent with the rights granted to ATUGEN herein in the Field.
RIBOZYME represents that the Patents set forth on Appendices D and E hereto
and the Cech Patents are the only Patents held by or owned by RIBOZYME
which are or could be useful with regard to TVD in the Field.
6.2 Representations of ATUGEN. ATUGEN represents and warrants that ATUGEN has
-------------------------
the legal right, authority and power to enter into this Agreement and meet
the obligations set forth herein.
6.3 Disclaimer. NOTHING IN THIS AGREEMENT SHALL BE DEEMED TO BE A
----------
REPRESENTATION OR WARRANTY BY RIBOZYME OF THE VALIDITY OF ANY OF THE
PATENTS OR THE ACCURACY, SAFETY, EFFICACY, OR USEFULNESS, FOR ANY PURPOSE,
OF ANY INVENTION, LICENSED TECHNOLOGY OR NUCLEIC ACID MOLECULE MANUFACTURED
BY RIBOZYME. RIBOZYME SHALL HAVE NO OBLIGATION, EXPRESS OR IMPLIED, TO
SUPERVISE, MONITOR, REVIEW OR OTHERWISE ASSUME RESPONSIBILITY FOR THE
PRODUCTION, MANUFACTURE, TESTING, MARKETING OR SALE OF ANY LICENSED
PRODUCT, AND RIBOZYME SHALL HAVE NO LIABILITY WHATSOEVER TO ATUGEN OR ANY
THIRD PARTIES FOR OR ON ACCOUNT OF ANY INJURY, LOSS, OR DAMAGE, OF ANY KIND
OR NATURE, SUSTAINED BY, OR ANY DAMAGE ASSESSED OR ASSERTED AGAINST, OR ANY
OTHER LIABILITY INCURRED BY OR IMPOSED UPON ATUGEN OR ANY OTHER PERSON OR
ENTITY, ARISING OUT OF OR IN CONNECTION WITH OR RESULTING FROM:
(1) the production, use, or sale of any Licensed Technology;
(2) the use of any aspect of Inventions; or
(3) any advertising or other promotional activities with respect to any of
the foregoing.
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Section 7
DUE DILIGENCE REQUIREMENTS
7.1 Due Diligence. ATUGEN shall use commercially reasonable efforts to
-------------
commercialize Licensed Technology in the Field through a thorough, vigorous
and diligent program for exploitation of RIBOZYME Patent Rights in the
Field, and to continue active, diligent marketing efforts for Licensed
Technology throughout the life of this Agreement.
7.2 Progress Reports. During the term of this Agreement, ATUGEN will submit
----------------
annual progress reports to RIBOZYME by 28 February of each year which
discuss the progress and results, as well as ongoing plans, with respect to
the RIBOZYME Patent Rights. RIBOZYME shall have the right to request one
meeting per year to discuss such information.
Section 8
MANUFACTURE AND SUPPLY OF NUCLEIC ACID MOLECULES AND DELIVERY REAGENTS
8.1 Manufacture of Nucleic Acid Molecules. RIBOZYME will manufacture or have
-------------------------------------
manufactured by a party acceptable to ATUGEN, provided such acceptance will
not be unreasonably withheld, the Nucleic Acid Molecules required by ATUGEN
under this Agreement. RIBOZYME shall provide such material to ATUGEN at
[*] per Nucleic Acid Molecule or at [*] of the Oligonucleotide Market
Price per Nucleic Acid Molecule, which ever is greater. The price per
Nucleic Acid Molecule, however, shall not exceed [*] of the
Oligonucleotide Market Price. If the price per Nucleic Acid Molecule
exceeds [*] of the Oligonucleotide Market Price, ATUGEN shall have
the option to purchase such Nucleic Acid Molecules from a third party.
Notwithstanding the foregoing, RIBOZYME shall supply to ATUGEN, the Nucleic
Acid Molecules at the rate of [*] for a [*] scale synthesis of
each Nucleic Acid molecule, so long as the Oligonucleotide Market Price for
such Nucleic Acid Molecule exceeds [*] scale synthesis. If the dollar
amount of Nucleic Acid Molecules or Delivery Reagents purchased by ATUGEN
from RIBOZYME exceeds the dollar amount provided in the enclosed Appendix
C, then RIBOZYME shall provide such material to ATUGEN at [*] per
Nucleic Acid Molecule or at [*] of the Oligonucleotide Market Price
per Nucleic Acid Molecule, which ever is greater. The price per Nucleic
Acid Molecule, however, shall not exceed [*] of the Oligonucleotide
Market Price.
8.2 Manufacture of Delivery Reagents. RIBOZYME will manufacture or have
--------------------------------
manufactured the Delivery Reagents required by ATUGEN under this Agreement.
RIBOZYME shall provide such material to ATUGEN [*] per Delivery
Reagent or at [*] of the Lipid Market Price per Delivery Reagent,
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which ever is greater. If the dollar amount of Delivery Reagents purchased
by ATUGEN from RIBOZYME exceeds the dollar amount provided for on Appendix
C attached hereto, then RIBOZYME shall provide such material to ATUGEN at
[*] of the Oligonucleotide Market Price per Nucleic Acid Molecule,
whichever is greater. The price per Nucleic Acid Molecule, however, shall
not exceed [*] of the Oligonucleotide Market Price.
8.3 Exclusivity. During the first [*] from the Effective Date of this
-----------
Agreement, ATUGEN shall purchase all its requirement of Nucleic Acid
Molecules and Delivery Reagents from RIBOZYME (except as provided in
Section 8.1), which may be extended based on mutual agreement of the
Parties. Other than as provided in Sections 8.1, 8.7 and 8.8 herein,
nothing in this Agreement is deemed to grant ATUGEN any right to
manufacture or have manufactured the Nucleic Acid Molecules and the
Delivery Reagents.
8.4 Minimum Purchase. During the first five (5) years of this Agreement,
----------------
ATUGEN shall purchase from RIBOZYME at least sixty percent (60%) of the
amounts of each Nucleic Acid Molecules and Delivery Reagents ("Minimum
Purchase") indicated in Appendix C, provided (i)[*.]
8.5 Minimum Capacity. RIBOZYME agrees to guarantee an annual Minimum Capacity,
----------------
equal to [*] of the minimum levels specified in Appendix C, for the
synthesis of Nucleic Acid Molecules.
8.6 Technology Transfer. It is agreed RIBOZYME will have transferred to
-------------------
ATUGEN, as a result of licenses granted hereunder and under the Sublicense
and other technology transferred under this Agreement, a value of at least
[*] after the deduction of the technology access fee.
8.7 Escrow Technology. RIBOZYME shall from time to time place into escrow
-----------------
written descriptions of its manufacturing and quality control procedures as
may be necessary for ATUGEN to fully manufacture the Nucleic Acid Molecules
("Escrow Technology"). To facilitate the provisions of this Section 8.7,
RIBOZYME shall promptly establish such escrow account and provide ATUGEN
periodic reports of its transfer of information to such account. In the
event that RIBOZYME cannot adequately supply ATUGEN with its requirements
of the Nucleic Acid Molecules within 45 days of written request therefore,
as to amounts or in accordance with ATUGEN's specifications, ATUGEN shall
have the right to access the Escrow technology to manufacture or have
manufactured the Nucleic Acid Molecules. RIBOZYME's intellectual property
trade secrets related to such technology transfer shall be treated as
Confidential Information of RIBOZYME under Article 4. Specifically,
manufacture by third parties will require the same degree of protection
that ATUGEN uses for its most important confidential information. In the
event of a Change in Control of RIBOZYME, ATUGEN shall be entitled to
continued access to the Escrow
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Technology necessary for ATUGEN to manufacture the Nucleic Acid Molecules
for use in the Field.
8.8 Change of Control. In the event of a Change of Control of RIBOZYME, unless
-----------------
provisions have been made, to the Investor's sole satisfaction to protect
ATUGEN's and the Investor's interest in the Escrow Technology, then ATUGEN
shall receive and have access to the Escrow Technology and shall have a
co-exclusive license in the Field to all Patents incorporated therein, if
any one of the following criteria are met:
8.8.1 More than [*] of the Acquirer's annual revenues (according to
the latest reported figures) are from its TVD activities; or
8.8.2 The Acquirer's actions, following the Change of Control of RIBOZYME,
have caused RIBOZYME activities under this Section 8 to be
significantly reduced, as determined by one or more of the following
parameters:
(1) [*]
(2) [*]
8.8.3 The Acquirer terminates the Service Agreement of November 23, 1998
between RIBOZYME and ATUGEN and/or this License Agreement.
8.8.4 ATUGEN unilaterally terminates the Service Agreement of November 23,
1998 between RIBOZYME and ATUGENand/or its obligation to purchase
Nucleic Acid Molecule and Delivery Reagents under this License
Agreement.
8.8.5 If such a transfer of the Escrow Technology to ATUGEN occurs, ATUGEN
agrees to pay to RIBOZYME or its successor according to the
following:
(1) ATUGEN shall pay to RIBOZYME a one-time fee equal [*]
RIBOZYME's Supply Profit during the prior twelve months if the
Service Agreement was terminated by ATUGEN pursuant to section
8.8.1 above or the Acquirer's actions described in section
8.8.2 caused a failure of performance by RIBOZYME under the
Service Agreement.
(2) ATUGEN shall pay to RIBOZYME an amount equal to [*] RIBOZYME's
Supply Profit on an annual basis if the Service Agreement was
terminated by ATUGEN under 8.8.4 above.
(3) ATUGEN shall not owe any payment to RIBOZYME if the Acquirer
terminates the Service Agreement as described in Section 8.8.3.
8.8.6 Payments. All such payments required by this Section 8.8 will be
--------
made within sixty (60) days after the occurrence of the indicated
event, to RPI or its successors by ATUGEN, based upon revenue and
expense records provided
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from RIBOZYME or its successor.
8.8.7 Future Royalties. In the event that the Escrow Technology is
----------------
accessed by ATUGEN as provided in this Section 2.4, ATUGEN will be
responsible for all payments which become due to third parties as a
result of action taken by ATUGEN in the Field.
Section 9
TERM AND TERMINATION
9.1 Term. The Term of this Agreement shall commence on the Effective Date
----
and shall continue until there are no Valid Claims in existence under
the RIBOZYME Patent Rights existing as of the Effective Date of this
Agreement unless terminated earlier as provided in this Section, and
other than as a result of the section 8.8.
9.2 Termination for Cause. Either Party shall have the right to
---------------------
terminate this Agreement following any material breach or default in
performance under this Agreement by the other Party upon sixty (60)
days prior written notice by certified mail to the breaching Party
specifying the nature of the breach or default. Unless the breaching
Party has either cured or taken such steps as may be reasonably
expected to cure the breach or default prior to the expiration of such
sixty (60) day period, the non-breaching Party, at its sole option,
may terminate this Agreement upon written notice to the breaching
Party. Termination of this Agreement shall become effective upon
receipt of such notice by the breaching Party.
9.3 Effect of Termination. In the event RIBOZYME terminates this License
---------------------
Agreement for cause under Section 9.2, RIBOZYME shall retain all the
rights granted to RIBOZYME by ATUGEN and all the rights granted to
ATUGEN by RIBOZYME under this Agreement shall terminate and revert
back to RIBOZYME.
9.4 Rights in Law or Equity. Except as otherwise expressly provided
-----------------------
herein, termination by either Party pursuant to this Section 9 shall
not prejudice any other remedy that a Party might have in law or
equity, except that neither Party may claim compensation for lost
opportunity or like consequential damages arising out of the fact of
such termination.
9.5 Termination for Insolvency. To the extent permitted by applicable
--------------------------
law, either Party may terminate this Agreement immediately upon
written notice without opportunity to cure if the other Party becomes
the subject of a voluntary or involuntary petition in bankruptcy or
any proceeding relating to insolvency, receivership, liquidation, or
composition for the benefit of
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creditors, if such petition or proceeding is not dismissed with
prejudice within ninety (90) days after filing. In the event of a
termination by RIBOZYME for insolvency, the Escrow Technology shall
transfer to ATUGEN at no cost.
9.6 Survival. The following Sections of this Agreement shall survive
--------
expiration or termination of this Agreement: 3.1, 4, 5, 9.6 and 10.
Section 10
GENERAL PROVISIONS
10.1 Dispute Resolution.
------------------
10.1.1 Any disputes arising between the Parties relating to, arising
out of or in any way connected with this Agreement or any term
or condition hereof, or the performance by either Party of its
obligations hereunder, whether before or after termination of
this Agreement, shall be promptly presented to the Chief
Executive Officer of RIBOZYME and the Chief Executive Officer
of ATUGEN (or their designees) for resolution. If these
individuals cannot promptly (within 30 days) resolve such
disputes, then such dispute shall be finally resolved by
binding arbitration. Whenever a Party shall decide to
institute arbitration proceedings, it shall give written
notice to that effect to the other Party. The Party giving
such notice shall refrain from instituting the arbitration
proceedings for a period of sixty (60) days following such
notice.
10.1.2 In the event that arbitration is instituted by ATUGEN, such
arbitration shall be held in Berlin, Germany. In the event
that arbitration is instituted by RIBOZYME, such arbitration
shall be held in Boulder, Colorado. Judgment on any award
rendered by the arbitrator may be entered in any court having
jurisdiction thereof. The Parties agree that, any provision of
applicable law notwithstanding, they will not request, and the
arbitrator shall have no authority to award, punitive or
exemplary damages against any Party.
10.1.3 Notwithstanding the above, in the event of a dispute
concerning inventorship between RIBOZYME and ATUGEN, the
Parties hereby agree that each will attempt to resolve such
dispute by agreement between two U.S. patent attorneys (one
chosen by each Party) according to U.S. patent laws. If those
two attorneys fail within 30 days to reach a resolution, then
the Parties agree to reach a binding agreement by negotiation
between those two attorneys and a third patent attorney chosen
by those two attorneys. The three attorneys will reach a
binding agreement with regard to the dispute by a majority
vote of the three
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attorneys. Such dispute will be resolved in this manner within
60 days from the date of the initial dispute.
10.2 No Use of Name. Neither Party shall use the name of the other in any
--------------
form of advertising publicity or otherwise, any trade-name, personal
name, trademark, trade device, service mark, symbol, or any
abbreviation, contraction or simulation thereof owned by the other
party; or public promotion without the prior written approval of the
other, or represent, either directly or indirectly, that any product
or service of the other party is a product or service of the
representing party or that it is made in accordance with or utilizes
the information or documents of the other party.
10.3 Governing Law. This Agreement shall be governed by, construed, and
-------------
interpreted in accordance with the laws of Germany, including but not
limited to, export control regulations regarding commodities and
technical data/information. Parties specifically agree not to export
or re-export any commodities and/or data/information in violation of
any applicable U.S.A. or German laws and/or regulations.
10.4 Assignment. This Agreement may not be assigned or transferred by
----------
any of the Parties hereto without the prior written consent of the
other Parties which will not be unreasonably withheld; provided,
however, that ATUGEN may assign or transfer ATUGEN's rights and
obligations under this Agreement to an affiliate of ATUGEN or a
successor to all or substantially all of its assets or business
relating to this Agreement, whether by sale, merger, operation of law
or otherwise upon written notice to RIBOZYME.
10.5 Entire Agreement. This Agreement constitutes the entire and only
----------------
agreement between the Parties relating to the subject matter hereof,
and all prior negotiations, representations, agreements and
understandings are superseded hereby.
10.6 Further Assurances. At any time or from time to time on and after
------------------
the Effective Date, RIBOZYME and ATUGEN shall at the request of the
other (a) deliver to the other such records, data or other documents
consistent with the provisions of this Agreement, (b) execute, and
deliver or cause to be delivered, all such assignments, consents,
documents or further instruments of transfer or license, and (c) take
or cause to be taken all such other actions, as may reasonably deem
necessary or desirable in order to obtain the full benefits of this
Agreement and the transactions contemplated hereby.
10.7 Notices. Any notice or other communication required or permitted
-------
under this Agreement shall be in writing and will be deemed given as
of the date such notice is (a) hand delivered, or (b) mailed, postage
prepaid, first class, certified mail, return receipt requested, or
(c) sent, shipping prepaid, receipt
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requested by national courier service, to the Party at the address
listed below or at such other addresses as may be given from time to
time in accordance with the terms of this notice provision.
If to ATUGEN:
ATUGEN Biotechnology GmbH.
Robert-Rossle-Strasse 10
13125 Berlin
Germany
Attention: Managing Director
If to RIBOZYME:
Ribozyme Pharmaceuticals Inc.
2950 Wilderness Place
Boulder, CO 80301
Attention: President & CEO
10.8 Modification. No modification to this Agreement shall be effective
------------
unless assented to in writing by the Party to be charged.
10.9 Waiver. The failure of a party in any instance to insist upon the
------
strict performance of the terms of this Agreement will not be
construed to be a waiver or relinquishment of any of the terms of
this Agreement, either at the time of the party's failure to insist
upon strict performance or at any time in the future, and such terms
will continue in full force and effect.
10.10 Headings. The headings of the several Sections of this Agreement are
--------
intended for convenience of reference only and are not intended to be
a part of or to affect the meaning or interpretation of this
Agreement.
10.11 Severability. In the event that any provision of this Agreement
------------
becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full
force and effect without said provision; provided that no such
severability shall be effective if the result of such action
materially changes the economic benefit of this Agreement to ATUGEN,
or to RIBOZYME.
10.12 Government Clearance. ATUGEN agrees to use commercially reasonable
--------------------
efforts to have the Inventions cleared for marketing in those
countries in which ATUGEN intends to sell Licensed Technology by the
responsible government agencies requiring such clearance. To
accomplish said clearances at the earliest possible date, ATUGEN
agrees to file, according to the usual practice of ATUGEN, any
necessary data with said government agencies.
10.13 Publication. Each Party shall use its best efforts to provide a copy
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of any
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publication under this Agreement forty-five (45) days in advance of
such submission for approval by the other party.
10.14 Language. A German and an English version of this Agreement exist.
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Only the English version of this Agreement is binding.
10.15 Counterparts. This Agreement may be executed in counterparts, each
------------
of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby,
have caused this Agreement to be executed by their duly authorized
representatives as of the date first written above.
ATUGEN BIOTECHNOLOGY GmbH
By: /s/ Ralph E. Christoffersen
---------------------------
Name: RALPH E. CHRISTOFFERSEN
-----------------------
Title: CEO/GESCHAFTSFUHRER
-------------------
Date: 11/23/98
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RIBOZYME PHARMACEUTICALS INC.
By: /s/ Larry Bullock
-----------------
Name: LARRY BULLOCK
-------------
Title: CFO
---
Date: 11/23/98
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APPENDIX A
CECH PATENTS
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<TABLE>
<CAPTION>
Title/Invention U.S. Patent No. Foreign Patents
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
RNA Ribozyme Polymerases, Dephosphorylases, 4,987,071 European Patent
Restriction Endoribonucleases and Methods No. 0291 533
Japanese Patent
No. 2530906
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Polymerases, and Methods 5,037,746 N/A
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Polymerases, Dephosphorylases, 5,093,246 N/A
Restriction Endoribonucleases and Methods
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Restriction Endoribonucleases and 5,116,742 N/A
Methods
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Which Cleaves Substrate RNA Without 5,354,855 N/A
Formation of a Cavalent Bond
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Polymerases, Dephosphorylases, 5,591,610 N/A
Restriction Endoribonucleases and Methods
- ------------------------------------------------------------------------------------------------
</TABLE>
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APPENDIX B
- -------------------------------------------------------------
Listing of Existing Licensees Effective Date
- -------------------------------------------------------------
Schering AG, Germany 4/9/97
- -------------------------------------------------------------
Roche Bioscience 5/19/98
- -------------------------------------------------------------
Chiron 5/13/96
- -------------------------------------------------------------
Glaxo-Wellcome 7/16/98
- -------------------------------------------------------------
Parke-Davis 3/2/98
- -------------------------------------------------------------
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Exhibit 99.4
CONFIDENTIAL PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO REGULATION
240.24B-2B OF THE SECURITIES EXCHANGE ACT OF 1934. [*] INDICATES OMITTED
MATERIAL THAT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST AND IS FILED
SEPARATELY WITH THE COMMISSSION.
MANUFACTURING AND SUPPLY
------------------------
AGREEMENT AND SUBLICENSE
------------------------
This Manufacturing and Supply Agreement and Sublicense (the "Agreement") is made
and entered into as of this 23rd day of November, 1998 ("Effective Date"), by
and between Ribozyme Pharmaceuticals Incorporated, a Delaware corporation with
offices located at 2950 Wilderness Place, Boulder, CO 80301 (hereinafter "RPI")
and ATUGEN organized under the laws of Germany, and having its principal office
in Berlin, Germany (hereinafter ATUGEN) (together, the "Parties").
WHEREAS, RPI is engaged in research, development and commercialization of
certain patented and/or proprietary nucleic acid technology for therapeutic,
agricultural, animal health, diagnostic and functional genomics applications
(the " RPI Technology");
WHEREAS, RPI has transferred to ATUGEN by license of technology (the "ATUGEN
LICENSE") and assignment of contracts its current Target Validation and
Discovery ("TVD") business, as further set forth in a certain Participation
Agreement which is incorporated by reference herein;
WHEREAS, ATUGEN has agreed to assume RPI 's current TVD business obligations, to
conduct TVD research and development and to perform TVD services subject to
RPI's rights to develop and commercialize with ATUGEN's customers certain human
therapeutics that may be developed as a result of such TVD services;
WHEREAS, ATUGEN may in the future desire to use ribozymes and other technology
covered by the Cech Patents (as defined herein) the rights to which RPI has
acquired pursuant to an Amended and Restated License Agreement between RPI and
Competitive Technologies, Inc. dated November 20, 1996 (the "CTI License").
WHEREAS, RPI wishes to have the right to manufacture and supply all ribozymes
used by ATUGEN in its research and development activities and in its TVD
business and in consideration of such rights, the right to collaborate, develop
and commercialize human therapeutics arising from ATUGEN's business and
reimbursement by ATUGEN of certain of RPI's costs related to the Cech Patents,
RPI is willing to grant a sublicense to the Licensed Technology (as defined
herein).
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NOW THEREFORE, in consideration of the mutual covenants herein contained and
intending to be legally bound hereby, the Parties hereto agree as follows:
Section 1
DEFINITIONS
1.1. "Affiliate" shall mean any corporation or other business entity
---------
controlled by, controlling, or under common control with ATUGEN. For purpose of
this Section 1.1, "control" shall mean direct or indirect beneficial ownership
of more than thirty percent (30%) of the voting stock or equity, or more than
thirty percent (30%) interest in the income of such corporation or other
business entity.
1.2. "Acquirer" shall mean an entity that intends to or does gain control of
--------
RPI operations.
1.3. "ATUGEN Patent Rights" shall mean, collectively, all right, title and
--------------------
interest of ATUGEN in, to and under (i) Patents covering ATUGEN Inventions and
(ii) Patents to which ATUGEN is a licensee with the right to sublicense rights
thereunder to RPI.
1.4. "Cech Patents" shall mean the inventions and discoveries which are the
------------
subject of, or which are covered in whole or in part by, the claims included in
(i) U.S. Patent Application Serial Number 937,327, filed December 3, 1986
entitled RNA RIBOZYME POLYMERASES, DEPHOSPHORYLASES, RESTRICTION
ENDORIBONUCLEASES AND METHODS (the "'327 Patent Application"), (ii) the United
States Patents listed in Appendix A, and any patents issuing thereon as well as
any corresponding patent applications or any patents that may issue thereon
throughout the world, including any extensions, renewals, divisions,
continuations, continuations-in-part, patents of addition, and/or reissues
thereof, including any patent application and any patents issuing thereon
throughout the world including any extensions, renewals, continuations,
continuations-in-part, divisions, patents of additions and/or reissues thereof,
filed upon any invention the practice of which would infringe the claims covered
by the foregoing patents, which invention was made by Thomas R. Cech, Arthur J.
Zaug and Michael D. Been, and/or persons acting under their direction and
control at the University of Colorado, which is the work product of the Research
Support Funding Agreement between USB and the University of Colorado Foundation
entered into on May 20, 1987 (the "RSFA") and which was conceived or reduced to
practice during the term of the RSFA.
1.5. "Change of Control of RPI " shall mean a merger or acquisition by, with
------------------------
or of RPI in which the equity holders of RPI immediately prior to such event do
not hold at least 51% of the equity of the resulting entity, and a single new
Acquirer controls
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at least 51% of the equity of the resulting entity or the sale of all or
substantially all the assets of RPI to a third party.
1.6. "COGS" means RIBOZYME's fully-burdened cost of supplying Ribozymes to
----
ATUGEN (including raw materials, direct labor, quality control testing,
labeling, packaging and shipping costs). calculated in accordance with RPI's
accounting methods consistently applied and in compliance with U.S. generally
accepted accounting principles (GAAP)
1.7. "Collaborator" shall mean any entity or person engaged in an active
------------
research and development collaboration with ATUGEN in its Target Validation and
Discovery program.
1.8. "Confidential Information" shall mean confidential and proprietary
------------------------
information of ATUGEN or RPI, including without limitation scientific data,
technical reports and business information, disclosed to the other Party,
provided that such information is in writing and marked "CONFIDENTIAL" or with a
similar legend, or is disclosed orally and is reduced to writing and marked
"CONFIDENTIAL" or with a similar legend within 30 days after such disclosure.
1.9. "Delivery Reagents" shall mean all RPI's reagents useful for the delivery
-----------------
of Ribozymes to cells that are covered under the Cech Patents, RPI Patent Rights
or RPI Technology.
1.10. "Escrow Technology" shall have the meaning provided under Section 8.7.
-----------------
1.11. "Existing Licensee" shall mean third parties to whom RPI has already
-----------------
granted certain licenses under RPI Patent Rights in the Field each of which is
listed in the enclosed Appendix B.
1.12. "Field" shall mean any and all applications of Ribozymes in the field of
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human therapeutic Target Validation and Discovery. Such Field will include
functional genomics or gene function identification in human systems, in which
the function of a gene is determined by using the Ribozyme. The Field shall
also include use of the Ribozymes to validate a human therapeutic target.
1.13. "Invention" shall mean any possibly patentable discovery or invention
---------
that is conceived and reduced to practice that if used, practiced, performed or
sold would infringe on the Cech Patents.
1.14. "Investor" shall mean BB Bio Ventures L.P., and its affliates, all of
--------
whom are managed by MPM Asset Management, LLC., an affiliate of MPM Capital LP.
1.15. "Licensed Technology" shall mean any technology that is either: (i)
-------------------
covered by any Cech Patent; or (ii) constitutes Non-Patented Technology owned
and/or controlled by RPI which is necessary or useful in the Field and which
could not
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be used, practiced, performed, made or sold without infringing on the Cech
Patents but for this Sublicense Agreement.
1.16. "New Invention" shall mean any possibly patentable discovery or
-------------
invention conceived and/or reduced to practice by RPI and/or ATUGEN in the
Field, or by ATUGEN in the RPI Field..
1.17. "Non-Patented Technology" means know-how, trade secrets or other
-----------------------
information or materials that are not patentable or, for a possibly patentable
discovery or invention, on which the parties choose not to file a patent, which
relate to the Cech Patents and which are either (i) made under this Agreement;
or (ii) are owned or controlled by RPI on the date of this Agreement and are
useful or necessary to the ATUGEN in the Field.
1.18. "Oligonucleotide Market Price" shall mean the price determined by mutual
----------------------------
agreement of the parties as the fair market value for oligonuclotides by
reference to oligonucleotide pricing schedules available from third parties for
the synthesis of an oligonucleotide with chemistry and length equivalent to the
Ribozyme to be supplied under this Agreement.
1.19. "Participation Agreement" shall mean the participation agreement of
------------------------
August 24, 1998, and all amendments thereof, executed by ATUGEN and founders of
ATUGEN, including RPI.
1.20. "Patents" shall mean (i) patents (including inventor's certificates)
-------
that include one or more Valid Claims, including without limitation any
substitution, extension (including supplemental protection certificate),
registration, confirmation, reissue, reexamination or renewal thereof, (ii)
pending applications, including provisional applications, continuations,
divisionals, and continuations-in-part of any of the foregoing. Patent right
"shall" mean RPI and/or ATUGEN patent rights.
1.21. "Patent Right" shall mean RPI Patent Rights and/or ATUGEN Patent Rights.
------------
1.22. "Ribozyme" shall mean a nucleic acid molecule covered by the claims of
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the Cech Patents.
1.23. "RPI Patent Rights" shall mean collectively, RPI's right, title and
-----------------
interest in, to and under the Cech Patents.
1.24. "Ribozyme Product" means any substance that (i) is or is intended to be
----------------
developed and sold commercially for administration to humans or animals or
plants or for therapeutic or diagnostic use and (ii) contains a Ribozyme.
1.25. "RPI Field" shall mean any and all applications of Ribozymes as a human
---------
or animal therapeutic or diagnostic products or an agricultural product but
excluding any application in the field of Target Validation and Discovery (TVD).
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1.26. "RPI's Supply Profit" shall mean RPI's Profit from the supply of
--------------------
Ribozymes, and other reagents covered under the Escrow Technology to ATUGEN
prior to the Change of Control of RPI. Profit as used in this section 1.26
shall mean the price of Ribozymes charged ATUGEN by RPI minus RPI's fully-
burdened COGS.
1.27. "Service Agreement" shall mean the Service Agreement between ATUGEN and
--------------------
RPI dated November 23, 1998, and any amendment(s) thereto.
1.28 "Target" means a gene or partial sequence thereof, and those elements
------
necessary for its expression or regulation, or its transcription,
translation, or replication product or intermediates or portions
thereof.
1.29. "Target Discovery Technology" means the use of RPI's combinatorial
---------------------------
ribozyme libraries to identify a Target(s) which, when combined with a target
specific enzymatic nucleic acid molecule, inhibits such Target's expression.
The Target can then be assessed in in vitro and in vivo models for its efficacy
in affecting the phenotype of cells or organism.
1.30. "Target Validation and Discovery (TVD)" means a research program in
-------------------------------------
which a nucleic acid molecule, including Ribozymes, is used to determine the
utility of a gene product, for the validation of a therapeutic target, and/or
for the discovery of new genes. Such a program is usually performed on behalf
of a third party Collaborator, but may be performed solely for ATUGEN's benefit
or may consist of technology rights which are licensed or sold to third parties
for use in their own non-nucleic acid-based product development programs outside
the RPI Field.
1.31. "Validated Target" shall mean a Target that has been validated in vitro
----------------
or in vivo as part of a TVD program by ATUGEN or its Collaborator.
1.32. "Valid Claim" shall mean either (i) a claim of an issued and unexpired
-----------
patent included within the Patent Rights, provided that such claim has not been
held permanently revoked, unenforceable or invalid by a decision of a court or
other governmental agency of competent jurisdiction, unappealable or unappealed
within the time allowed for appeal, and has not been admitted to be invalid or
unenforceable through reissue, disclaimer or otherwise, or (ii) a claim of a
patent application within the Patent Rights actively being prosecuted.
Section 2
MANUFACTURE AND SUPPLY OF RIBOZYMES AND DELIVERY REAGENTS
2.1 Manufacture of Ribozymes. RPI will manufacture or have manufactured by
------------------------
a party acceptable to ATUGEN, provided such acceptance will not be
unreasonably withheld, the Ribozymes required by ATUGEN under this
Agreement. RPI shall provide such material to ATUGEN [ * ] per Ribozyme
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or at [ * ] of the Oligonucleotide Market Price per Ribozyme, which ever is
greater. The price per Ribozyme, however, shall not exceed [ * ] of the
Oligonucleotide Market Price. If the price per Ribozyme exceeds [ * ] of
the Oligonucleotide Market Price, ATUGEN shall have the option to purchase
such Ribozymes from a third party. If the dollar amount of Ribozymes
purchased by ATUGEN from RPI exceeds the dollar amount provided for in
Appendix C attached hereto, then RPI shall provide such material to ATUGEN
at COGS plus [ * ] per Ribozyme or at [ * ] of the Oligonucleotide Market
Price per Ribozyme, which ever is greater. The price per Ribozyme, in such
instance, shall not however exceed [ * ] of the Oligonucleotide Market
Price.
2.2 Exclusivity. During the first five (5) years from the Effective Date of
-----------
this Agreement, ATUGEN shall purchase all its requirement of Ribozymes from
RPI (except as provided in section 2.1 above), which may be extended based
on mutual agreement of the Parties. Other than as provided in sections 2.1,
2.4 and 2.5 herein, nothing in this Agreement is deemed to grant ATUGEN any
right to manufacture or have manufactured the Ribozymes.
2.3 Escrow Technology. RPI shall from time to time place into escrow written
-----------------
descriptions of its manufacturing and quality control procedures as may be
necessary for ATUGEN to fully manufacture Ribozymes. ("Escrow Technology")
To facilitate the provisions of this section 2.5, RPI shall promptly
establish such escrow account and provide ATUGEN periodic reports of its
transfer of information to such account. In the event that RPI cannot
adequately supply ATUGEN with its requirements of the Ribozymes within 45
days of written request therefore, as to amounts or in accordance with
ATUGEN's specifications, ATUGEN shall have the right to access the Escrow
technology to manufacture or have manufactured the Ribozymes. RPI's
intellectual property trade secrets related to such technology transfer
shall be treated as Confidential Information of RPI under Section 4.
Specifically, manufacture by third parties will require the same degree of
protection that ATUGEN uses for its most important confidential
information. In the event of a Change in Control of RPI, ATUGEN shall be
entitled to continued access to the Escrow Technology necessary for ATUGEN
to manufacture the Ribozymes for use in the Field.
2.4 Change of Control. In the event of a Change of Control of RPI, unless
-----------------
provisions have been made, to the Investor's sole satisfaction, to protect
ATUGEN's and the Investor's interest in the Escrow Technology, then ATUGEN
shall receive and shall have access to the Escrowed Technology and
shallhave a co-exclusive license in the Field to all Patents incorporated
therein, if any one of the following criteria are met:
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2.4.1 More than [ * ] of the Acquirer's annual revenues (according to the
latest reported figures) are from its TVD activities; or
2.4.2 The Acquirer's actions, following the Change of Control of RPI, have
caused RPI activities under this Section 2 to be significantly
reduced, as determined by one or more of the following parameters:
(a) [ * ]
(b) [ * ]
2.4.3 The Acquirer terminates the Service Agreement of November 23, 1998
between RPI and ATUGEN.
2.4.4 ATUGEN unilaterally terminates the Service Agreement of November 23,
1998 between RPI and ATUGEN and/or its obligation to purchase Nucleic
Acid Molecules and Delivery Reagents under this Manufacturing and
Supply Agreement and Sublicense.
2.4.5 If such a transfer of the Escrow Technology to ATUGEN occurs, ATUGEN
agrees to pay to RPI or its successor the following:
(1) ATUGEN shall pay to RPI a one-time fee equal to [ * ] RPI's
Supply Profit during the prior twelve months, if the Service
Agreement was terminated by ATUGEN pursuant to section 2.4.1
above or the Acquirer's actions described in section 2.4.2.
(2) ATUGEN shall pay to RPI a one-time fee equal to [ * ] RPI's
Supply Profit on an annual basis if the Service Agreement was
terminated by ATUGEN under 2.4.4 above.
(3) ATUGEN shall not owe any payment to RPI if the Acquirer
terminates the Service Agreement as described in Section 2.4.3.
2.4.6 All such payments provided in this section 2.4 will be made within
sixty (60) days of the occurance of the indicated event, to RPI or its
successors by ATUGEN, based on revenue and expense records provided by
RPI or its successor to ATUGEN.
2.4.7 In the event the Escrow Technology is accessed by ATUGEN as provided
in this section 2.4, ATUGEN will be responsible for any and all
payments which become due to third parties (including, but not limited
to, the CTI License), as a result of action taken by ATUGEN in the
Field.
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Section 3
SUBLICENSE, GRANT, CONSIDERATIONS,
AND ENFORCEMENT AND DEFENSE
3.1 Grant to ATUGEN.
---------------
3.1.1
RPI hereby grants to ATUGEN an exclusive, with a right to sub-license as
set forth in section 3.1.2 below, worldwide ("Territory") right and
license under the RPI Patent Rights, and Non Patented Technology for the
duration of the Term:
(i) to develop, promote, market, distribute, use, sell, offer to
sell or otherwise dispose of, use and import Licensed
Technology in the Field; and
(ii) to practice and use methods and processes described or claimed
in the RPI Patent Rights within the Field.
Notwithstanding the foregoing, such license shall be co-exclusive with
respect to RPI to the extent that RIBOZYME uses the RPI Patent Rights
and Non-Patented Technology solely for the following purposes:
(a) for RPI's internal research purposes;
(b) to serve the Existing Licensees, if applicable, in the
Field, provided that no rights may be granted to any
Existing Licensee to any New Invention for use in the Field
unless RPI is currently contractually obligated to do so;
(c) for use in collaboration(s) with third parties to conduct
research, develop and commercialize human therapeutic
Ribozyme Products, where such use, with each such third
party collaborator, will involve, within any given six-month
period, examination of no more than five (5) Targets for
each disease indication. RPI, however, will not use the
Target Discovery Technology to identify new Targets in the
Field under a collaboration with a third party nor shall RPI
permit any such third party to conduct any of its own
discovery efforts using the Target Discovery Technology. It
is also understood and agreed by the parties that RPI shall
not develop its own TVD program using any ATUGEN Patent
Rights or any RPI Patent Rights licensed to ATUGEN herein,
subject to the provisions of this Section 3.1.1.
3.1.2 ATUGEN shall have no right to grant sublicenses to any Licensed
Technology, other than Licensed Technology sold or licensed by ATUGEN in
the regular course of its business in the Field or pursuant to a
collaborative drug development or discovery agreement with a third party
in the Field but subject in all cases to the limitations of Section
3.1.5. Such sublicensee shall not have the right to further sublicense
any Licensed Technology under this Agreement without RPI's prior written
consent, which consent shall not be unreasonably withheld, particularly
in the case of territorial sublicenses by a collaborative partner. Any
such sublicenses shall comply with the terms of the CTI License.
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3.1.3 RPI agrees to use reasonable best efforts to prosecute and obtain
issuance of any pending patent applications under the RPI Patent
Rights. Notwithstanding the foregoing, RPI shall not be liable for
failure to obtain issued patents for the pending applications. ATUGEN
shall have the right to prosecute any Patents that RPI decides not to
prosecute and ATUGEN shall bear the cost of prosecuting such Patents.
3.1.4 RPI agrees not to grant licenses under RPI Patent Rights in the Field
to a third party other than pursuant to its existing agreements with
the Existing Licensees.
3.1.5 Notwithstanding the foregoing, RPI shall retain an exclusive right to
develop and commercialize Ribozyme Products in the RPI Field. ATUGEN
agrees, that it will clearly stipulate in its TVD Agreements that RPI
shall retain an exclusive right to develop and commercialize Ribozyme
Products against the Validated Target identified under such TVD
Agreements. ATUGEN shall provide a list of Validated Targets to RPI
once every quarter subject to the confidentiality provisions of
Section 4 herein; provided, however, that in the event of Change of
Control of RPI as set forth in section 2.4, ATUGEN will not be
required to provide such list to RPI.
3.1.6 The parties recognize that the rights granted to RPI by ATUGEN under
this Agreement might be restricted according to the principles,
guidelines, conditions and collateral provisions of public or semi-
public German entities providing or intending to provide grants to
ATUGEN, and the Parties will comply with them.
3.2 Consideration
-------------
3.2.1 In addition to the rights of RPI under sections 2 and 3.1.5, as
further consideration for the rights and license granted to ATUGEN
hereunder, ATUGEN will pay to RPI [ * ] of all future costs and
expenses in connection with prosecution, defense and enforcement of
the Cech Patents, subject to the limitations set forth below.
3.2.2 [ * ]
3.2.3 All payments to be made to RPI by ATUGEN under this Section 3 shall
be paid within thirty (30) days of the receipt of RPI's invoice by
ATUGEN. Checks for all payments to RPI under this Agreement shall be
deposited in the following bank account of RPI:
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Name of the Bank: Norwest Bank of Denver
Address: 1740 Broadway Street, Denver, CO 80204
[ * ]
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For further credit to Norwest Bank of Boulder, Ribozyme
Pharmaceuticals Inc.,
Account No.: [ * ]
----
In the event that any payment due to RPI by ATUGEN is delinquent,
interest shall accrue on any overdue amount at the rate of one percent
(1%) per month or the maximum rate permitted by law, whichever is
less.
3.3 Defense. In the event of any claim(s) against ATUGEN, arising within
-------
[ * ] for infringement of any intellectual property right of any third
party as a direct result of the exercise of the sublicense granted by RPI
to ATUGEN hereunder, RPI shall indemnify and hold harmless ATUGEN, its
officers, directors, licensees and assigns from any and all such claims,
provided, however, that RPI's liability under this Section 3.3 and Section
3.3 of the ATUGEN License shall not exceed [ * ]. RPI shall have sole
control of any such legal action or settlement negotiations and shall have
the right to settle any such litigation by grant of any rights to the
third party provided ATUGEN approves of such grant, which approval shall
not be unreasonably withheld. ATUGEN agrees to assist RPI in defending
such claims.
3.4 Patent Enforcement. RPI and ATUGEN shall each provide immediate written
------------------
notice to the other of any infringement of the Cech Patents in the Field,
which may come to such Party's attention. RPI shall have the exclusive
right to institute and conduct commercially reasonable legal action
against third party infringers of the Cech Patents in the Field, or
negotiate and enter into settlement agreements as deemed appropriate by
RPI after consultation with ATUGEN if necessary. ATUGEN shall provide RPI
with reasonable assistance in any action taken by RPI to enforce the Cech
Patents, but at no point will ATUGEN contribute any amount in excess of
RPI's own contribution to that date in such action. ATUGEN shall have the
option at such time as expenditures pursuant, to this section reach [ * ],
to elect to terminate its license to the Cech Patents and to terminate any
future obligations to participate in the enforcement of the Cech Patents.
Such option shall be renewed upon the expenditure of each [ * ] increment
thereafter. ATUGEN shall not, however be entitled to join RPI as a Party
to any such action. Any award of damages resulting from action taken by
RPI pursuant to this Section 3, after reimbursement of expenses incurred
by RPI and ATUGEN in connection with such action, shall be divided equally
between the parties, provided that such infringement was deemed to have
occurred in the Field and specifically involve the Licensed Technology. If
ATUGEN does not
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participate in such legal action all rights to the Cech Patents granted
ATUGEN hereunder shall revert to RPI and RPI shall then have the right to
use Ribozymes in the Field.
Section 4
CONFIDENTIALITY
4.1 Confidential Information. Any Party receiving any Confidential
------------------------
Information from the other Party in connection with the execution, delivery
and performance of this Agreement shall keep, and shall cause its
affiliates, officers, employees, students, technicians, advisors and
consultants to keep, all such Confidential Information in confidence and
shall not disclose such Confidential Information to third parties, except
in connection with a license, sublicense or sale permitted hereunder
requiring such disclosure and containing appropriate confidentiality
provisions.
4.2 Inapplicability. The obligations of confidentiality and nonuse set forth
---------------
in this Agreement shall not apply to any portion of the Confidential
Information which:
(i) is or becomes public or available to the general public otherwise
than through the act or default of the receiving Party or its affiliates or
their employees, advisors or consultants; or
(ii) is obtained by the receiving Party from a third party without a duty
of confidentiality who is lawfully in possession of such Confidential
Information and is not subject to an obligation of confidentiality owed to the
other Party or others; or
(iii) is known, as shown by competent evidence, by the receiving Party or
any of its affiliates prior to disclosure under this Agreement and was not
obtained or derived directly or indirectly from the other Party; or
(iv) is disclosed by the receiving Party or its affiliates pursuant to a
requirement of law, provided that such Party has complied with the provisions
set forth in paragraph 4.3.
4.3 Notice Prior to Disclosure. If the receiving Party, or any of its
--------------------------
sublicensees or Affiliates becomes legally required to disclose any
Confidential Information, the receiving Party shall give the other Party to
this Agreement prompt notice of such fact so that such Party may obtain a
protective order or other appropriate remedy concerning any such disclosure
and/or waive compliance with the non-disclosure provisions of this
Agreement. The receiving Party and its Affiliates will fully cooperate with
the other Party to this Agreement in connection with such Party's efforts
to obtain any such order or other remedy. If any such order or other remedy
does not fully preclude disclosure
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or the other Party to this Agreement waives such compliance, the receiving
Party and its Affiliates will make such disclosure only to the extent that
such disclosure is legally required and will use its best efforts to have
confidential treatment accorded to the disclosed Confidential Information.
Notwithstanding the foregoing provisions, ATUGEN will be free to disclose
the terms of this Agreement to a third party, including ATUGEN's
Collaborators and potential investors, under confidentiality with such
third parties.
4.4 Term. The obligations of ATUGEN and RPI under this Section 4 shall
----
continue for a period of five (5) years after the expiration of this
Agreement.
4.5 Return of Materials. Upon expiration or termination of this Agreement, each
-------------------
Party shall return all copies of Confidential Information disclosed to such
Party, and all other materials provided to such Party under this Agreement;
provided that one copy of such Confidential Information and such materials
may be retained for archival or legal purposes only.
Section 5
LIABILITY AND INDEMNIFICATION
5.1 Indemnification by ATUGEN. ATUGEN agrees to indemnify, hold harmless and
-------------------------
defend RPI, its officers, employees, and agents, against any and all
claims, suits, losses, damages, costs, fees, and expenses asserted by third
parties, both government and non-government, resulting from or arising out
of any product manufactured or sold by ATUGEN pursuant to the exercise of
this license, other than claims covered by RPI's indemnification in Section
3.3 above. ATUGEN shall not be responsible for the negligence or
intentional wrong doing of RPI.
5.2 Insurance. ATUGEN shall maintain in force at its sole cost and expense,
---------
with reputable insurance companies, general liability insurance and
products liability insurance coverage in an amount reasonably sufficient to
protect against liability under paragraph 5.1 above. RPI shall have the
right to ascertain from time to time that such coverage exists, such right
to be exercised in a reasonable manner.
5.3 Force Majeure. The Parties will not be liable for any failure to perform
-------------
as required by this Agreement, to the extent such failure to perform is
caused by any reason beyond the control of either Party, or by reason of
any of the following: labor disturbances or disputes of any kind,
accidents, governmental policy, civil disorders, acts of aggression, acts
of God, energy or other conservation measures, failure of utilities,
mechanical breakdowns, material shortages, disease or similar occurrences.
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Section 6
REPRESENTATIONS AND WARRANTIES
6.1 Representations of RPI. RPI represents that RPI has the legal right,
----------------------
authority and power to enter into this Agreement and meet the obligations
set forth herein. RPI further represents that it has not previously
granted other than the rights previously granted to Existing Licensees,
and will not grant to any third party during the term of this Agreement,
any rights under the Cech Patents that are inconsistent with the rights
granted to ATUGEN herein in the Field.
6.2 Representations of ATUGEN. ATUGEN represents and warrants that ATUGEN has
-------------------------
the legal right, authority and power to enter into this Agreement and meet
the obligations set forth herein.
6.3 Disclaimer. NOTHING IN THIS AGREEMENT SHALL BE DEEMED TO BE A
----------
REPRESENTATION OR WARRANTY BY RPI OF THE VALIDITY OF ANY OF THE CECH
PATENTS OR THE ACCURACY, SAFETY, EFFICACY, OR USEFULNESS, FOR ANY PURPOSE,
OF ANY LICENSED TECHNOLOGY, OR RIBOZYME MANUFACTURED BY RPI. RPI SHALL
HAVE NO OBLIGATION, EXPRESS OR IMPLIED, TO SUPERVISE, MONITOR, REVIEW OR
OTHERWISE ASSUME RESPONSIBILITY FOR THE PRODUCTION, MANUFACTURE, TESTING,
MARKETING OR SALE OF ANY LICENSED PRODUCT, AND RPI SHALL HAVE NO LIABILITY
WHATSOEVER TO ATUGEN OR ANY THIRD PARTIES FOR OR ON ACCOUNT OF ANY INJURY,
LOSS, OR DAMAGE, OF ANY KIND OR NATURE, SUSTAINED BY, OR ANY DAMAGE
ASSESSED OR ASSERTED AGAINST, OR ANY OTHER LIABILITY INCURRED BY OR
IMPOSED UPON ATUGEN OR ANY OTHER PERSON OR ENTITY, ARISING OUT OF OR IN
CONNECTION WITH OR RESULTING FROM:
(a) the production, use, or sale of any Licensed Technology or
ribozymes;
(b) the use of any aspect of Inventions; or
(c) any advertising or other promotional activities with respect to any
of the foregoing.
Section 7
TERM AND TERMINATION
7.1 Term. The Term of this Agreement shall commence on the Effective Date and
----
shall continue until there are no Valid Claims in existence on the Cech
Patents unless terminated earlier as provided in this Section, and other
than as a result of the Section 2.4.
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7.2 Termination for Cause. Either Party shall have the right to terminate this
---------------------
Agreement following any material breach or default in performance under
this Agreement by the other Party upon sixty (60) days prior written notice
by certified mail to the breaching Party specifying the nature of the
breach or default. Unless the breaching Party has either cured or taken
such steps as may be reasonably expected to cure the breach or default
prior to the expiration of such sixty (60) day period, the non-breaching
Party, at its sole option, may terminate this Agreement upon written notice
to the breaching Party. Termination of this Agreement shall become
effective upon receipt of such notice by the breaching Party.
7.3 Effect of Termination. In the event RPI terminates this Manufacturing and
---------------------
Supply Agreement and Sub-license Agreement for cause under Section 7.2, RPI
shall retain all the rights granted to RPI by ATUGEN and all the rights
granted to ATUGEN by RPI under this Agreement shall terminate and revert
back to RPI.
7.4 Rights in Law or Equity. Except as otherwise expressly provided herein,
-----------------------
termination by either Party pursuant to this Section 7 shall not prejudice
any other remedy that a Party might have in law or equity, except that
neither Party may claim compensation for lost opportunity or like
consequential damages arising out of the fact of such termination.
7.5 Termination for Insolvency. To the extent permitted by applicable law,
--------------------------
either Party may terminate this Agreement immediately upon written notice
without opportunity to cure if the other Party becomes the subject of a
voluntary or involuntary petition in bankruptcy or any proceeding relating
to insolvency, receivership, liquidation, or composition for the benefit of
creditors, if such petition or proceeding is not dismissed with prejudice
within ninety (90) days after filing. In the event of a termination by RPI
for insolvency, the Escrow Technology shall transfer to ATUGEN at no cost.
7.6 Survival. The following Sections of this Agreement shall survive
--------
expiration or termination of this Agreement: 3.1, 4, 5, 7.6 and 8.
Section 8
GENERAL PROVISIONS
8.1 Dispute Resolution.
------------------
8.1.1 Any disputes arising between the Parties relating to, arising out of
or in any way connected with this Agreement or any term or condition
hereof, or the performance by either Party of its obligations
hereunder, whether before or after termination of this Agreement,
shall be promptly presented to the Chief Executive Officer of RPI
and the Chief
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Executive Officer of ATUGEN (or their designees) for resolution. If
these individuals cannot promptly (within 30 days) resolve such
disputes, then such dispute shall be finally resolved by binding
arbitration. Whenever a Party shall decide to institute arbitration
proceedings, it shall give written notice to that effect to the
other Party. The Party giving such notice shall refrain from
instituting the arbitration proceedings for a period of sixty (60)
days following such notice.
8.1.2 In the event that arbitration is instituted by ATUGEN, such
arbitration shall be held in Berlin, Germany. In the event that
arbitration is instituted by RPI, such arbitration shall be held in
Boulder, Colorado. Judgment on any award rendered by the arbitrator
may be entered in any court having jurisdiction thereof. The Parties
agree that, any provision of applicable law notwithstanding, they
will not request, and the arbitrator shall have no authority to
award, punitive or exemplary damages against any Party.
8.1.3 Notwithstanding the above, in the event of a dispute concerning
inventorship between RPI and ATUGEN, the Parties hereby agree that
each will attempt to resolve such dispute by agreement between two
U.S. patent attorneys (one chosen by each Party) according to U.S.
patent laws. If those two attorneys fail within 30 days to reach a
resolution, then the Parties agree to reach a binding agreement by
negotiation between those two attorneys and a third patent attorney
chosen by those two attorneys. The three attorneys will reach a
binding agreement with regard to the dispute by a majority vote of
the three attorneys. Such dispute will be resolved in this manner
within 60 days from the date of the initial dispute.
8.2 No Use of Name. Neither Party shall use the name of the other in any form
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of advertising publicity or otherwise, any trade-name, personal name,
trademark, trade device, service mark, symbol, or any abbreviation,
contraction or simulation thereof owned by the other party; or public
promotion without the prior written approval of the other, or represent,
either directly or indirectly, that any product or service of the other
party is a product or service of the representing party or that it is made
in accordance with or utilizes the information or documents of the other
party.
8.3 Governing Law. This Agreement shall be governed by, construed, and
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interpreted in accordance with the laws of Germany, including but not
limited to, export control regulations regarding commodities and technical
data/information. Parties specifically agree not to export or re-export any
commodities and/or data/information in violation of any applicable U.S.A.
or German laws and/or regulations.
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8.4 Assignment. This Agreement may not be assigned or transferred by any of
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the Parties hereto without the prior written consent of the other Parties
which will not be unreasonably withheld; provided, however, that ATUGEN may
assign or transfer ATUGEN's rights and obligations under this Agreement to
an affiliate of ATUGEN or a successor to all or substantially all of its
assets or business relating to this Agreement, whether by sale, merger,
operation of law or otherwise upon written notice to RPI.
8.5 Entire Agreement. This Agreement constitutes the entire and only agreement
----------------
between the Parties relating to the subject matter hereof, and all prior
negotiations, representations, agreements and understandings are superseded
hereby.
8.6 Further Assurances. At any time or from time to time on and after the
------------------
Effective Date, RPI and ATUGEN shall at the request of the other (a)
deliver to the other such records, data or other documents consistent with
the provisions of this Agreement, (b) execute, and deliver or cause to be
delivered, all such assignments, consents, documents or further instruments
of transfer or license, and (c) take or cause to be taken all such other
actions, as may reasonably deem necessary or desirable in order to obtain
the full benefits of this Agreement and the transactions contemplated
hereby.
8.7 Notices. Any notice or other communication required or permitted under
-------
this Agreement shall be in writing and will be deemed given as of the date
such notice is (a) hand delivered, or (b) mailed, postage prepaid, first
class, certified mail, return receipt requested, or (c) sent, shipping
prepaid, receipt requested by national courier service, to the Party at the
address listed below or at such other addresses as may be given from time
to time in accordance with the terms of this notice provision:
If to ATUGEN: ATUGEN Biotechnology GmbH.
Robert-Rossle-Strasse 10
13125 Berlin
Germany
Attention: Managing Director
If to RPI : Ribozyme Pharmaceuticals Inc.
2950 Wilderness Place
Boulder, CO 80301
Attention: President & CEO
8.8 Modification. No modification to this Agreement shall be effective unless
------------
assented to in writing by the Party to be charged.
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8.9 Waiver. The failure of a party in any instance to insist upon the strict
------
performance of the terms of this Agreement will not be construed to be a
waiver or relinquishment of any of the terms of this Agreement, either at
the time of the party's failure to insist upon strict performance or at any
time in the future, and such terms will continue in full force and effect.
8.10 Headings. The headings of the several sections of this Agreement are
--------
intended for convenience of reference only and are not intended to be a
part of or to affect the meaning or interpretation of this Agreement.
8.11 Severability. In the event that any provision of this Agreement becomes
------------
or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and
effect without said provision; provided that no such severability shall be
effective if the result of such action materially changes the economic
benefit of this Agreement to ATUGEN, or to RPI.
8.12 Government Clearance. ATUGEN agrees to use commercially reasonable efforts
--------------------
to have the Inventions cleared for marketing in those countries in which
ATUGEN intends to sell Licensed Technology by the responsible government
agencies requiring such clearance. To accomplish said clearances at the
earliest possible date, ATUGEN agrees to file, according to the usual
practice of ATUGEN, any necessary data with said government agencies.
8.13 Publication. Each Party shall use its best efforts to provide a copy of
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any publication under this Agreement forty-five (45) days in advance of
such submission for approval by the other party.
8.14 Language. A German and an English version of this Agreement exist. Only
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the English version of this Agreement is binding.
8.15 Counterparts. This Agreement may be executed in counterparts, each of
------------
which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby,
have caused this Agreement to be executed by their duly authorized
representatives as of the date first written above.
ATUGEN BIOTECHNOLOGY GmbH
By: /s/ Ralph E. Christoffersen
--------------------------------
Name: RALPH E. CHRISTOFFERSEN
--------------------------------
Title: CEO/GESCHAFTSFUHRER
--------------------------------
Date: 11/23/98
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RIBOZYME PHARMACEUTICALS INC.
By: /s/ Larry Bullock
--------------------------
Name: LARRY BULLOCK
--------------------------
Title: CFO
--------------------------
Date: 11/23/98
--------------------------
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APPENDIX A
CECH PATENTS
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<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
Title/Invention U.S. Patent No. Foreign Patents
- ------------------------------------------------------------------------------------------------
<S> <C> <C>
RNA Ribozyme Polymerases, Dephosphorylases,
Restriction Endoribonucleases and Methods 4,987,071 European Patent No.
0291 533
Japanese Patent No.
2530906
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Polymerases, and Methods 5,037,746 N/A
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Polymerases, Dephosphorylases,
Restriction Endoribonucleases and Methods 5,093,246 N/A
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Restriction Endoribonucleases and
Methods 5,116,742 N/A
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Which Cleaves Substrate RNA Without
Formation of a Cavalent Bond 5,354,855 N/A
- ------------------------------------------------------------------------------------------------
RNA Ribozyme Polymerases, Dephosphorylases,
Restriction Endoribonucleases and Methods 5,591,610 N/A
- ------------------------------------------------------------------------------------------------
</TABLE>
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APPENDIX B
<TABLE>
<CAPTION>
-------------------------------------------------------------
Listing of Existing Licensees Effective Date
-------------------------------------------------------------
<S> <C>
Schering AG, Germany 4/9/97
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Roche Bioscience 5/19/98
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Chiron 5/13/96
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Glaxo-Wellcome 7/16/98
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Parke-Davis 3/2/98
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</TABLE>
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Exhibit 99.5
CONFIDENTIAL PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO REGULATION
240.24B-2B OF THE SECURITIES EXCHANGE ACT OF 1934. [*] INDICATES OMITTED
MATERIAL THAT IS THE SUBJECT OF A CONFIDENTIAL TREATMENT REQUEST AND IS FILED
SEPARATELY WITH THE COMMISSSION.
SERVICE AGREEMENT
This Service Agreement (the "Agreement") is made and entered into as of this
_23_ day of November 1998 ("Effective Date"), by and between Ribozyme
--------
Pharmaceuticals Incorporated, a Delaware corporation with offices located at
2950 Wilderness Place, Boulder, CO 80301 (hereinafter "RPI") and ATUGEN
Biotechnology GmbH organized under the laws of Germany, and having its principal
office in Berlin, Germany (hereinafter ATUGEN) (together, the "Parties").
WHEREAS, RPI is engaged in research, development and commercialization of
certain patented and/or proprietary nucleic acid technologies for therapeutic,
agricultural, animal health, diagnostic and functional genomics applications
(the " RPI Technology");
WHEREAS, ATUGEN is interested in conducting research, development and
commercialization activities in the field of Target Validation and Discovery
(TVD), as more fully described in the Business Plan of July 30, 1998, and
amendments thereof and a certain Participation Agreement which is incorporated
by reference herein; and
WHEREAS, ATUGEN desires to obtain from RPI, and RPI is willing to provide,
certain advice, consultation and other services in the field of Target
Validation and Discovery.
NOW THEREFORE, in consideration of the mutual covenants herein contained and
intending to be legally bound hereby, the Parties hereto agree as follows:
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Section 1
DEFINITIONS
1.1. "Business Development Team" shall mean RPI employees currently working in
---------------------------
the business development group of RPI which currently includes four
professionals and two support staff.
1.2. "COGS" means RPI's fully-burdened costs of supplying Nucleic Acid
----
Molecules (including costs of raw materials, direct labor, quality control
testing, labeling, packaging and shipping costs) calculated in accordance
with RPI's accounting methods consistently applied in compliance with U.S.
generally accepted accounting principles (GAAP).
1.3. "Collaborator" shall mean any entity or person engaged in an active
------------
research and development collaboration with ATUGEN in its Target
Validation and Discovery program.
1.4. "Confidential Information" shall mean confidential and proprietary
------------------------
information of ATUGEN or RPI, including without limitation scientific
data, technical reports and business information, disclosed to the other
Party, provided that such information is in writing and marked
"CONFIDENTIAL" or with a similar legend, or is disclosed orally and is
reduced to writing and marked "CONFIDENTIAL" or with a similar legend
within 30 days after such disclosure.
1.5. "Delivery Reagents" shall mean RPI reagents useful for the delivery of
-----------------
Nucleic Acid Molecules to cells that are covered under RPI Technology.
1.6. "Existing Licensee" shall mean third parties with whom RPI has already
-----------------
granted certain licenses under RPI Technology in the Field and are listed
in the enclosed Appendix A.
1.7. "Expressed Ribozyme" shall mean a DNA or RNA vector encoding a Ribozyme
------------------
and intended to be used to express such Ribozyme in cells.
1.8. "Field" shall mean any and all applications of Nucleic Acid Molecules, in
-----
the field of human therapeutic Target Validation and Discovery, transgenic
animal technology, Chip Technology and associated bioinformatics. Such
Field will include functional genomics or gene function identification in
human systems, in which the function of a gene is determined by using the
Nucleic Acid Molecule. The Field shall also include use of the Nucleic
Acid Molecules to validate a human therapeutic target.
1.9. "License Agreements" shall mean the License Agreement between RPI and
------------------
ATUGEN dated November 23, 1998; a Manufacturing and Supply Agreement and
Sublicense
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Agreement and any amendments thereof, all of which are incorporated by
reference herein.
1.10. "Lipid Market Price" shall mean the average arms-length retail selling
------------------
cost of the two market leading reagents for cell-based transfection.
These two market leading reagents shall be identified based on mutual
agreement of the Parties.
1.11. "Nucleic Acid Molecules" shall mean Expressed Ribozymes or Synthetic
----------------------
Ribozymes, GeneBloc reagents or nucleic acid probes. The term Nucleic
Acid Molecules, as used herein, shall not include (i) nucleic acid
molecules used for cloning, sequencing or amplification purposes, or
(ii) protein-encoding or peptide-encoding genes.
1.12. Nucleic Acid Product" means any substance that (i) is or is intended to
--------------------
be developed and sold commercially, and (ii) contains a non-protein or
non-peptide encoding oligonucleotide, including but not limited to, a
Nucleic Acid Molecule.
1.13. "Oligonucleotide Market Price" shall mean the price determined by mutual
----------------------------
agreement of the parties as the fair market price for an oligonucleotide
by reference to a Nucleic Acid Molecule available from third party price
lists comprising greater than fifty percent (50%) 2'-O-alkyl nucleotide
modification, an appropriate 5'- and/or 3'-cap modification and a length
equivalent to the Nucleic Acid Molecule to be supplied.
1.14 "Participation Agreement" shall mean the participation agreement of
August 24, 1998, and all amendments thereof, executed by ATUGEN and
founders of ATUGEN, including RPI.
1.15 "Prospective Licensee" shall mean third parties with whom RPI is
--------------------
currently discussing the licensing of certain RPI Technology in the Field
and are listed in the enclosed Appendix B.
1.16. "Ribozyme" shall mean a Nucleic Acid Molecule able to cause catalytic
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cleavage of itself or another molecule independent of protein.
1.17. "RPI Field" shall mean any and all applications of Nucleic Acid
---------
Molecules, including but not limited to, as a human or animal therapeutic
or diagnostic product or an agricultural product but excluding any
application of Nucleic Acid Molecules in the field of Target Validation
and Discovery (TVD).
1.18. "Synthetic Ribozyme" shall mean chemically synthesized Ribozymes.
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1.19. "Target" means a gene or partial sequence thereof, and those elements
------
necessary for its expression or regulation, or its transcription,
translation, or replication product or intermediates or portions thereof.
1.20. "Target Validation and Discovery (TVD)" means a research program in which
-------------------------------------
a nucleic acid molecule, including Nucleic Acid Molecules, is used to
determine the utility of a gene or gene product, as a therapeutic or a
therapeutic target, and/or for the discovery of genes or gene products as
potential therapeutics or therapeutic targets or as tools for the
identification of potential therapeutics or therapeutic targets. Such a
program is usually performed on behalf of a third party Collaborator, but
may be performed solely for ATUGEN's benefit or may consist of technology
rights which are licensed or sold to third parties for use in their own
non-Nucleic Acid-Molecule-based product development programs outside the
RPI Field.
Section 2
SCOPE OF RPI ACTIVITIES FOR ATUGEN
2.1 Activities. RPI will use reasonable best efforts to provide ATUGEN with all
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the advice, consulting and other services in the Field reasonably requested
by ATUGEN, ("RPI Activities"). The RPI Activities shall include, but shall
not be limited to, the following:
2.1.1. RPI shall transfer it's Target Validation and Discovery (TVD) business
to ATUGEN, subject to RPI's right to use the TVD program to the extent
that the License Agreements so allows
2.1.2. RPI shall transfer to ATUGEN RPI technology relating to the use of
Nucleic Acid Molecules in the Field.
2.1.3. RPI will supply to ATUGEN Nucleic Acid Molecules for use in the Field
under the provisions of the License Agreements.
2.1.4. RPI will supply to ATUGEN its Delivery Reagents for use in delivering
the Nucleic Acid Molecules to a range of cell types in the Field under
the provisions of the License Agreements.
2.1.5. RPI shall provide financial support to ATUGEN in the amount of two
million U.S. dollars (US $2 million) under the terms of the
Participation Agreement, at the Closing of the Participation Agreement.
2.1.6. RPI shall provide the following Scientific Consulting and Management
Support to ATUGEN:
2.1.6.1. RPI's Business Development Team will devote up to fifty percent (50%)
of it's time, during the first twelve (12) months from September 1,
1998, to provide Business Development support to ATUGEN under the
terms of this Agreement. ATUGEN may opt to extend this term of support
for an
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additional three-(3) months by requesting RPI for such an extension in
writing prior to the expiration of the nine month period.
2.1.6.2. RPI's Dr. Ralph E. Christoffersen (President and CEO) and Mr. Larry
Bullock (CFO) will spend up to twenty five percent (25%) of their time,
during the first nine (9) months from September 1, 1998, to provide
management support to ATUGEN under the terms of this Agreement. Such
Management support will include hiring senior and other personnel and
facilitating a smooth transition and technology transfer to ATUGEN. Dr.
Christoffersen and Mr. Bullock will make all reasonable efforts,
including possibly spending more time (greater than 25%) to meet the
management needs of ATUGEN during this nine (9) month period or for a
longer period of time if necessary as mutually agreed to by the
Parties. Neither Dr. Christoffersen nor Mr. Bullock will be deemed an
ATUGEN employee.
2.1.6.3. RPI's Dr. Nassim Usman (Vice President of Research) will spend up to
twenty five percent (25%) of his time, during the first nine (9) months
from September 1, 1998, to provide Research and Development management
support including a smooth transition and technology transfer, under
the terms of this Agreement. Such Management support will also include
hiring senior and other personnel necessary for ATUGEN. ATUGEN may opt
to extend this term of support for an additional three-(3) months by
requesting RPI for such an extension in writing prior to the expiration
of the nine month period. Dr. Usman at no time will be deemed an ATUGEN
employee.
2.1.6.4. RPI's Dr. James Thompson (Associate Director of Functional Genomics)
will become an ATUGEN employee upon commencement of ATUGEN's
operations. Dr. Thompson will remain in the Boulder, Colorado facility
and will not relocate to Berlin. The details of Dr. Thompson's
employment with ATUGEN will be governed under a separate Employment
Contract with ATUGEN.
2.1.6.5. RPI and its personnel will make all reasonable efforts to facilitate
the transfer of necessary technology and provide necessary services to
ATUGEN as provided herein.
2.1.6.6. For purposes of clarification, ATUGEN and RPI shall based on mutual
agreement determine the timing of the services to be provided by the
foregoing personnel, including the time, place and amount of services
to be rendered, up to the limits prescribed herein.
2.1.7. Existing Licensee Transfer.
---------------------------
RPI will transfer its contract with the Existing Licensees (see Appendix
A) to ATUGEN under the following terms, provided such transfer is
legally possible and the Existing Licensees agree to such a transfer.
RPI agrees to use its best efforts to obtain such approvals. One or more
representatives from ATUGEN, Berlin offices may have an opportunity to
assist RPI in its efforts to obtain the approvals from Existing
Licensees.
2.1.7.1. Beginning on the Effective Date of this Agreement and for a period of
five years thereafter, RPI shall receive all milestone payments,
success
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fees, and royalties provided under the contracts with each of the
Existing Licensees. ATUGEN will receive all research and development
payments under these contracts, provided ATUGEN will hire certain RPI
employees in Boulder, Colorado (the minimum number of such employees
to be based on contractual requirements in the agreements between RPI
and the Existing Licensees who have transferred to ATUGEN), and
provide necessary resources required for performance under the
agreements with the Existing Licensees. Such RPI employees hired by
ATUGEN under this section 2.1.7.1 will remain in Boulder, Colorado
facility and not relocate to Berlin, Germany.
2.1.7.2. After the fifth anniversary of the Effective Date of this Agreement,
RPI shall receive all milestone payments, success fees and royalty
payments relating to the development and commercialization of Nucleic
Acid Products provided under the contracts with each of the Existing
Licensees. ATUGEN will receive all other payments under these
contracts.
2.1.8. Prospective Licensee. For the contracts with the Prospective
---------------------
Licensees listed in Appendix B that are formalized by August 30, 1999,
or a later date designated based on mutual agreement of the Parties,
ATUGEN will pay to RPI a [*] of the total transaction value received
by ATUGEN from each such Prospective Licensee. To avoid double
payment, the success fee, under this Section 2.1.8, will not be paid
to RPI on any amounts for which RPI shall be directly reimbursed under
this Agreement or the supply provisions of the License Agreement.
2.1.9. The scope of activities to be performed by RPI for ATUGEN is strictly
limited to the above-mentioned services in this section unless
otherwise mutually agreed. Under no circumstances will RPI be entitled
to enter into business activities, such as negotiating contracts for
ATUGEN with third parties, for or on behalf of ATUGEN beyond the
auxiliary functions after the Effective Date of this contract.
Notwithstanding the foregoing, RPI will provide the services provided
under Sections 2.1.6.1-2.1.6.3 above, on behalf of and for ATUGEN.
Section 3
REMUNERATION FOR RPI AND RELATED PROVISIONS
3.1. Calculation of Fees. ATUGEN shall make payments to RPI according to the
-------------------
following provisions:
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3.1.1. For the services described under Sections 2.1.6.1, 2.1.6.2 and 2.1.6.3
above, ATUGEN will pay to RPI an amount equal [*] the actual salary of
each RPI executive (as set out in the financial statements of RPI filed
with the Securities and Exchange Commission (SEC)) performing services
thereunder, prorated to reflect time actually spent performing services
for ATUGEN during any given billing period. This payment, which takes
into account and fully compensates RPI for the additional costs (like
bonus, secretarial support, insurance etc.) incurred by RPI in
connection with the rendering of these services, shall be the only fee
to which RPI shall be entitled in connection with Sections 2.1.6.1,
2.1.6.2 and 2.1.6.3.
3.1.2. For the services described under Section 2.1.6.5 above, ATUGEN will pay
to RPI an amount equal to the billing rate of fully burdened cost per
full-time equivalent per year for each RPI employee, prorated to reflect
time actually spent performing services for ATUGEN during any given
billing period. This payment, which takes into account and fully
compensates RPI for the additional costs (like bonus, secretarial
support, insurance etc.,) incurred by RPI in connection with the
rendering of these services, shall be the only fee to which RPI is
entitled in connection with Section 2.1.6.5.
3.1.3. RPI shall not be entitled to any payments for services rendered pursuant
to Sections 2.1.3 and 2.1.4 other than those fees to which it is
entitled pursuant to the License Agreements.
3.1.4. For the services set forth in Sections 2.1.1, 2.1.2 and 2.1.6.4 or
otherwise requested by ATUGEN, ATUGEN shall reimburse RPI for its Costs
and Other Expenses (as defined in Section 3.2 below) incurred in the
performance of its obligations under those sections.
3.2. Costs. Under this Agreement Costs shall mean all costs incurred by RPI
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directly or indirectly in connection with the above-mentioned services
(i.e. rent, wages, travel expenses and the like), [*] plus any applicable
Value Added Tax (VAT), such [*] being intended to cover general
administrative expenses incurred in connections with such costs). Costs
shall not include out-of-pocket expenses, such as payments to advertising
agencies, promotion agencies and the like ("Other Expenses"). These Other
Expenses will be reimbursed by ATUGEN to RPIbut shall shall not be subject
to an additional[*].
3.3. Records. RPI shall record all costs actually incurred on the basis of
-------
completed costs using a recognized cost accounting method. All costs shall
be allocated to either RPI or ATUGEN, in accordance with such recognized
cost accounting method, based on the allocation key that is most
commensurate with the underlying activity. RPI shall document all
procedural instructions for the recording, determination and allocation of
costs. Such records shall be kept at RPI's principal place of business and
shall be retained
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by RPI for three (3) years following the end of the calendar year to which
such books and records pertain.
3.4 Audit Rights. ATUGEN shall be entitled to retain, at its own expense, an
------------
independent accounting firm to conduct one (1) audit per calendar year of
RPI's books and records of account regarding invoices for services provided
by RPI under this Agreement, for the sole purpose of verifying the accuracy
of invoices and RPI's compliance with the terms and conditions of this
Agreement. Such audit shall be conducted during RPI's normal business
hours and after at least ten (10) days written notice to RPI requesting the
audit.
3.5 Annual Estimates. Prior to the beginning of each fiscal year, RPI and
----------------
ATUGEN shall collaborate to establish an annual non-binding estimation of
the amount of services RPI will perform under this Agreement during such
fiscal year. The budget for 1999 shall be agreed upon within sixty (60)
days from the Effective Date of this Agreement.
3.6 Billing Cycle. RPI shall provide to ATUGEN invoices for services no more
-------------
than once per month and no less than twice per year. Each such invoice
shall be due and payable thirty (30) days following its receipt by ATUGEN.
Section 4
CONFIDENTIALITY
4.1 Any Party receiving any Confidential Information from the other Party in
connection with the execution, delivery and performance of this Agreement
shall keep, and shall cause its affiliates, officers, employees,
technicians, advisors and consultants and other agents to keep, all such
Confidential Information in confidence and shall not disclose such
Confidential Information to third parties, except in connection with a
license, sublicense or sale permitted hereunder requiring such disclosure
and containing appropriate confidentially provisions.
4.2 The obligations of confidentiality and nonuse set forth in this Agreement
shall not apply to any portion of the Confidential Information which:
(a) is or becomes public or available to the general public otherwise
than through the act or default of the receiving Party or its
affiliates or their employees, advisors or consultants; or
(b) is obtained by the receiving Party from a third party without a duty
of confidentiality who is lawfully in possession of such Confidential
Information and is not subject to an obligation of confidentiality
owed to the other Party or others; or
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(c) is known, as shown by competent evidence, by the receiving Party or
any of its affiliates prior to disclosure under this Agreement and
was not obtained or derived directly or indirectly from the other
Party; or
(d) is disclosed by the receiving Party or its affiliates pursuant to a
requirement of law, provided that such Party has complied with the
provisions set forth in paragraph 4.3.
4.3. If the receiving Party or any of its Affiliates becomes legally required
to disclose any Confidential Information, the receiving Party shall give
the other Party to this Agreement prompt notice of such fact so that such
Party may obtain a protective order or other appropriate remedy concerning
any such disclosure and/or waive compliance with the non-disclosure
provisions of this Agreement. The receiving Party and its Affiliates will
fully cooperate with the other Party to this Agreement in connection with
such Party's efforts to obtain any such order or other remedy. If any such
order or other remedy does not fully preclude disclosure or the other
Party to this Agreement waives such compliance, the receiving Party and
its affiliates will make such disclosure only to the extent that such
disclosure is legally required and will use its best efforts to have
confidential treatment accorded to the disclosed Confidential Information.
Notwithstanding the foregoing provisions, ATUGEN will be free to disclose
the terms of this Agreement to a third party, including ATUGEN's
Collaborators and potential investors, under confidentiality with such
third parties.
4.4 Term. The obligations of ATUGEN and RPI under this Section 4 shall
----
continue for a period of five (5) years after the expiration of this
Agreement.
4.5 Return of Materials. Upon expiration or termination of this Agreement,
-------------------
each Party shall return all copies of Confidential Information disclosed
to such Party, and all other materials provided to such Party under this
Agreement; provided that one copy of such Confidential Information and
such materials may be retained for archival or legal purposes only.
Section 5
LIABILITY AND INDEMNIFICATION
5.1. ATUGEN agrees to indemnify, hold harmless and defend RPI, its officers,
employees, and agents, against any and all claims, suits, losses, damages,
costs, fees, and expenses asserted by third parties, both government and
non-government, resulting from or arising out of the exercise of this
Agreement. ATUGEN shall not be responsible for the negligence or
intentional wrong-doing of RPI and RPI shall indemnify and hold harmless
ATUGEN and its agents for such actions if necessary.
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5.2. ATUGEN shall maintain in force at its sole cost and expense, with
reputable insurance companies, general liability insurance and products
liability insurance coverage in an amount reasonably sufficient to protect
against liability under paragraph 5.1 above. RPI shall have the right to
ascertain from time to time that such coverage exists, such right to be
exercised in a reasonable manner.
5.3. Force Majeure. The Parties will not be liable for any failure to perform
-------------
as required by this Agreement, to the extent such failure to perform is
caused by any reason beyond the control of either Party, or by reason of
any of the following: labor disturbances or disputes of any kind,
accidents, governmental policy, civil disorders, acts of aggression, acts
of God, energy or other conservation measures, failure of utilities,
mechanical breakdowns, material shortages, disease or similar occurrences.
Section 6
REPRESENTATIONS AND WARRANTIES
6.1. Representations of RPI. RPI represents that RPI has the legal right,
----------------------
authority and power to enter into this Agreement and meet the obligations
set forth herein. RPI further represents that it has not previously granted
other than to Existing Licensees, and will not grant to any third party
during the term of this agreement, any rights under the RPI Technology that
are inconsistent with the rights granted to ATUGEN herein in the Field. RPI
further declares that it has experience in providing the services described
under Section 2 of this Agreement and will use reasonable diligence in
providing these services.
6.2 Representations of ATUGEN. ATUGEN represents and warrants that ATUGEN has
-------------------------
the legal right, authority and power to enter into this Agreement and meet
the obligations set forth herein.
6.3 NOTHING IN THIS AGREEMENT SHALL BE DEEMED TO BE A REPRESENTATION OR
WARRANTY BY RPI OF THE VALIDITY OF ANY OF THE PATENTS OR THE ACCURACY,
SAFETY, EFFICACY, OR USEFULNESS, FOR ANY PURPOSE, OF ANY INVENTION. RPI
---------
SHALL HAVE NO OBLIGATION, EXPRESS OR IMPLIED, TO SUPERVISE, MONITOR, REVIEW
OR OTHERWISE ASSUME RESPONSIBILITY FOR THE PRODUCTION, MANUFACTURE,
TESTING, MARKETING OR SALE OF ANY LICENSED PRODUCT, AND RPI SHALL HAVE NO
LIABILITY WHATSOEVER TO ATUGEN OR ANY THIRD PARTIES FOR OR ON ACCOUNT OF
ANY INJURY, LOSS, OR DAMAGE, OF ANY KIND OR NATURE, SUSTAINED BY, OR ANY
DAMAGE ASSESSED OR ASSERTED AGAINST, OR ANY OTHER LIABILITY INCURRED BY OR
IMPOSED UPON ATUGEN OR ANY OTHER PERSON OR ENTITY, ARISING OUT OF OR IN
CONNECTION WITH OR RESULTING FROM:
a. the production, use, or sale of any RPI Technology;
b. the use of any aspect of inventions; or
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c. any advertising or other promotional activities with respect to
any of the foregoing.
Section 7
TERM AND TERMINATION
7.1. Term. The Term of this Agreement shall commence on the Effective Date and
----
continue until terminated as provided in this Section.
7.2. Termination for Cause. Either Party shall have the right to terminate
---------------------
this Agreement following any material breach or default in performance
under this Agreement by the other Party upon sixty (60) days prior written
notice by certified mail to the breaching Party specifying the nature of
the breach or default. Unless the breaching Party has either cured or
taken such steps as may be reasonably expected to cure the breach or
default prior to the expiration of such sixty (60) day period, the non-
breaching Party, at its sole option, may terminate this Agreement upon
written notice to the breaching Party. Termination of this Agreement shall
become effective upon receipt of such notice by the breaching Party.
7.3. Rights in Law or Equity. Except as otherwise expressly provided herein,
------------------------
termination by either Party pursuant to this Section 7 shall not prejudice
any other remedy that a Party might have in law or equity, except that
neither Party may claim compensation for lost opportunity or like
consequential damages arising out of the fact of such termination.
7.4. Termination for Insolvency. To the extent permitted by applicable law,
--------------------------
either Party may terminate this Agreement immediately upon written notice
without opportunity to cure if the other Party becomes the subject of a
voluntary or involuntary petition in bankruptcy or any proceeding relating
to insolvency, receivership, liquidation, or composition for the benefit
of creditors, if such petition or proceeding is not dismissed with
prejudice within ninety (90) days after filing.
7.5. Termination at will: RPI has the right to terminate this Agreement at the
-------------------
end of each calendar year after the completion of the first year from the
Effective Date, provided it gives ATUGEN a six (6) month written notice
prior to termination.
7.6. Effect of Termination In the event of the termination of this Agreement
---------------------
neither party shall have any further obligations under this agreement
except as set forth in Section 7.7.
7.7 Survival. The following Sections of this Agreement shall survive
--------
expiration or termination of this Agreement: 4, 5 7.7 and 8.
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Section 8
GENERAL PROVISIONS
8.1. Dispute Resolution
------------------
8.1.1 Any disputes arising between the Parties relating to, arising out
of or in any way connected with this Agreement or any term or
condition hereof, or the performance by either Party of its
obligations hereunder, whether before or after termination of this
Agreement, shall be promptly presented to the Chief Executive
Officer of RPI and the Chief Executive Officer of ATUGEN (or their
designees) for resolution. If these individuals cannot promptly
(within 30 days) resolve such disputes, then such dispute shall be
finally resolved by binding arbitration. Whenever a Party shall
decide to institute arbitration proceedings, it shall give written
notice to that effect to the other Party. The Party giving such
notice shall refrain from instituting the arbitration proceedings
for a period of thirty (30) days following such notice.
8.1.2 In the event that arbitration is instituted by ATUGEN, such
arbitration shall be held in Berlin, Germany. In the event that
arbitration is initiated by RPI, such arbitration shall be held in
Berlin, Germany. Judgment on any award rendered by the arbitrator
may be entered in any court having jurisdiction thereof. The Parties
agree that, any provision of applicable law notwithstanding, they
will not request, and the arbitrator shall have no authority to
award, punitive or exemplary damages against any Party.
8.1.3 Notwithstanding the above, in the event of a dispute concerning
inventorship between RPI and ATUGEN, the Parties hereby agree that
each will attempt to resolve such dispute by agreement between two
U.S. patent attorneys (one chosen by each Party) according to U.S.
patent laws. If those two attorneys fail within 30 days to reach a
resolution, then the Parties agree to reach a binding agreement by
negotiation between those two attorneys and a third patent attorney
chosen by those two attorneys. The three attorneys will reach a
binding agreement with regard to the dispute by a majority vote of
the three attorneys. Such dispute will be resolved in this manner
within 60 days from the date of the initial dispute.
8.2 No Use of Name. Neither Party shall use the name of the other in any form
--------------
of advertising publicity or otherwise, any trade-name, personal name,
trademark, trade device, service mark, symbol, or any abbreviation,
contraction or simulation thereof owned by the other party; or public
promotion without the prior written approval of the other, or
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represent, either directly or indirectly, that any product or service of
the other party is a product or service of the representing party or that
it is made in accordance with or utilizes the information or documents of
the other party.
8.3 Governing Law. This Agreement shall be governed by, construed, and
-------------
interpreted in accordance with the laws of Germany, including but not
limited to, export control regulations regarding commodities and technical
data/information. Parties specifically agree not to export or re-export
any commodities and/or data/information in violation of any applicable
U.S.A. or German laws and/or regulations.
8.4 Assignment. This Agreement may not be assigned or transferred by any of
----------
the Parties hereto without the prior written consent of the other Parties
which will not be unreasonably withheld; provided, however, that ATUGEN
may assign or transfer ATUGEN's rights and obligations under this
Agreement to an affiliate of ATUGEN or a successor to all or substantially
all of its assets or business relating to this Agreement, whether by sale,
merger, securities sale, operation of law or otherwise upon written notice
to RPI.
8.5 Entire Agreement. This Agreement constitutes the entire and only
----------------
agreement between the Parties relating to the subject matter hereof, and
all prior negotiations, representations, agreements and understandings are
superseded hereby.
8.6 Further Assurances. At any time or from time to time on and after the
------------------
Effective Date, RPI and ATUGEN shall at the request of the other (a)
deliver to the other such records, data or other documents consistent with
the provisions of this Agreement, (b) execute, and deliver or cause to be
delivered, all such assignments, consents, documents or further
instruments of transfer or license, and (c) take or cause to be taken all
such other actions, as may reasonably deem necessary or desirable in order
to obtain the full benefits of this Agreement and the transactions
contemplated hereby.
8.7 Notices. Any notice or other communication required or permitted under
-------
this Agreement shall be in writing and will be deemed given as of the date
such notice is (a) hand delivered, or (b) mailed, postage prepaid, first
class, certified mail, return receipt requested, or (c) sent, shipping
prepaid, receipt requested by national courier service, to the Party at
the address listed below or at such other addresses as may be given from
time to time in accordance with the terms of this notice provision.
If to ATUGEN: ATUGEN Biotechnology GmbH.
Robert-Rossle-Strasse 10
13125 Berlin
Germany
Attention: Managing Director
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If to RPI: Ribozyme Pharmaceuticals Inc.
2950 Wilderness Place
Boulder, CO 80301
Attention: President & CEO
8.8. Amendments or Modifications. No amendment or modification to this Agreement
---------------------------
shall be effective unless assented to in writing by the Parties hereto. In
additon the parties will discuss in good faith any amendments requested by
the appropriate German government agency.
8.9 Waiver. The failure of a party in any instance to insist upon the strict
------
performance of the terms of this Agreement will not be construed to be a
waiver or relinquishment of any of the terms of this Agreement, either at
the time of the party's failure to insist upon strict performance or at any
time in the future, and such terms will continue in full force and effect.
8.10 Headings. The headings of the several sections of this Agreement are
--------
intended for convenience of reference only and are not intended to be a
part of or to affect the meaning or interpretation of this Agreement.
8.11 Severability Should any of the provisions of this Agreement prove to be
-------------
invalid or should this agreement contain omissions, the efficacy of the
remaining provisions shall not be disturbed. In lieu of the invalid
provision, the valid provision which comes closest to fulfilling the
intended economic purpose of the invalid provision shall be deemed agreed
upon. In the case of omissions, the provision which represents the meaning
and intention of this agreement and would have been agreed to if the
parties had been aware of it shall be deemed agreed upon.
8.12 Publication. Each Party shall use its best efforts to provide a copy of any
-----------
publication under this Agreement forty-five (45) days in advance of such
submission for approval by the other party.
8.13 Counterparts. This Agreement may be executed in counterparts, each of
------------
which shall be deemed an original, but all of which together shall
constitute one and the same English version is binding.
8.14 Language. An English and a German version of this Agreement exist. Only the
--------
English version is binding, and the German version shall not be used for
any legal purpose, interpretive or otherwise.
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IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby,
have caused this Agreement to be executed by their duly authorized
representatives as of the date first written above.
ATUGEN BIOTECHNOLOGY GmbH
By: /s/ Ralph E. Christoffersen
-----------------------------
Name: RALPH E. CHRISTOFFERSEN
-----------------------------
Title: CEO/GESCHAFTSFUHRER
--------------------
Date: 11/23/98
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RIBOZYME PHARMACEUTICALS INC.
By: /s/ Larry Bullock
-----------------------------
Name: LARRY BULLOCK
-----------------------------
Title: CFO
---
Date: 11/23/98
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<PAGE>
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<PAGE>
Appendix A
<TABLE>
<CAPTION>
- --------------------------------------------------------------------
Listing of Existing Licensees Effective Date
- --------------------------------------------------------------------
<S> <C> <C>
1. Schering AG, Germany 4/9/97
- --------------------------------------------------------------------
2. Roche Bioscience 5/19/98
- --------------------------------------------------------------------
3. Chiron 5/13/96
- --------------------------------------------------------------------
4. Glaxo-Wellcome 7/16/98
- --------------------------------------------------------------------
5. Parke-Davis 3/2/98
- --------------------------------------------------------------------
</TABLE>
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<PAGE>
Appendix B
- ---------------------------------------------------------
Prospective Licensees
- ---------------------------------------------------------
1. Abbott Laboratories
- ---------------------------------------------------------
2. Schering-Plough
- ---------------------------------------------------------
3. Metabolex
- ---------------------------------------------------------
4. Immunex
- ---------------------------------------------------------
5. Merck
- ---------------------------------------------------------
6. E. Merck
- ---------------------------------------------------------
7. Grunenthal
- ---------------------------------------------------------
8. Rhone-Poulenc-Rorer
- ---------------------------------------------------------
9. Alcon Laboratories
- ---------------------------------------------------------
10. Glaxo-Wellcome expansion
- ---------------------------------------------------------
11. Amgen
- ---------------------------------------------------------
12. Astra-Charnwood
- ---------------------------------------------------------
13. Smith-Kline Beecham
- ---------------------------------------------------------
14. Onyx
- ---------------------------------------------------------
15. Schering AG Expansion of TVD collaboration
- ---------------------------------------------------------
16. Signal Pharmaceuticals
- ---------------------------------------------------------
17. Parke-Davis Pharmaceuticals expansion
- ---------------------------------------------------------
18. Chiron expansion
- ---------------------------------------------------------
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